[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
BLACKWATER USA
=======================================================================
HEARING
before the
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
OCTOBER 2, 2007
__________
Serial No. 110-89
__________
Printed for the use of the Committee on Oversight and Government Reform
Available via the World Wide Web: http://www.gpoaccess.gov/congress/
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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
HENRY A. WAXMAN, California, Chairman
TOM LANTOS, California TOM DAVIS, Virginia
EDOLPHUS TOWNS, New York DAN BURTON, Indiana
PAUL E. KANJORSKI, Pennsylvania CHRISTOPHER SHAYS, Connecticut
CAROLYN B. MALONEY, New York JOHN M. McHUGH, New York
ELIJAH E. CUMMINGS, Maryland JOHN L. MICA, Florida
DENNIS J. KUCINICH, Ohio MARK E. SOUDER, Indiana
DANNY K. DAVIS, Illinois TODD RUSSELL PLATTS, Pennsylvania
JOHN F. TIERNEY, Massachusetts CHRIS CANNON, Utah
WM. LACY CLAY, Missouri JOHN J. DUNCAN, Jr., Tennessee
DIANE E. WATSON, California MICHAEL R. TURNER, Ohio
STEPHEN F. LYNCH, Massachusetts DARRELL E. ISSA, California
BRIAN HIGGINS, New York KENNY MARCHANT, Texas
JOHN A. YARMUTH, Kentucky LYNN A. WESTMORELAND, Georgia
BRUCE L. BRALEY, Iowa PATRICK T. McHENRY, North Carolina
ELEANOR HOLMES NORTON, District of VIRGINIA FOXX, North Carolina
Columbia BRIAN P. BILBRAY, California
BETTY McCOLLUM, Minnesota BILL SALI, Idaho
JIM COOPER, Tennessee JIM JORDAN, Ohio
CHRIS VAN HOLLEN, Maryland
PAUL W. HODES, New Hampshire
CHRISTOPHER S. MURPHY, Connecticut
JOHN P. SARBANES, Maryland
PETER WELCH, Vermont
Phil Schiliro, Chief of Staff
Phil Barnett, Staff Director
Earley Green, Chief Clerk
David Marin, Minority Staff Director
C O N T E N T S
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Page
Hearing held on October 2, 2007.................................. 1
Statement of:
Prince, Erik, chairman, the Prince Group, LLC and Blackwater
USA........................................................ 23
Satterfield, Ambassador David M., Senior Advisor to the
Secretary and Coordinator for IRAQ, U.S. Department of
State; Ambassador Richard J. Griffin, Assistant Secretary
of State, Bureau of Diplomatic Security, U.S. Department of
State; and William H. Moser, Deputy Assistant Secretary for
Logistics Management, U.S. Department of State............. 123
Satterfield, Ambassador David M.......................... 123
Letters, statements, etc., submitted for the record by:
Davis, Hon. Tom, a Representative in Congress from the State
of Virginia, prepared statement of......................... 15
Griffin, Ambassador Richard J., Assistant Secretary of State,
Bureau of Diplomatic Security, U.S. Department of State,
prepared statement of...................................... 128
Hodes, Hon. Paul W., a Representative in Congress from the
State of New Hampshire, information concerning pay......... 104
Lynch, Hon. Stephen F., a Representative in Congress from the
State of Massachusetts, various e-mails.................... 112
Prince, Erik, chairman, the Prince Group, LLC and Blackwater
USA, prepared statement of................................. 25
Sali, Hon. Bill, a Representative in Congress from the State
of Idaho, prepared statement of............................ 166
Satterfield, Ambassador David M., Senior Advisor to the
Secretary and Coordinator for IRAQ, U.S. Department of
State, prepared statement of............................... 125
Watson, Hon. Diane E., a Representative in Congress from the
State of California, prepared statement of................. 162
Waxman, Chairman Henry A., a Representative in Congress from
the State of California:
Information concerning contracts......................... 70
Prepared statement of.................................... 5
Majority staff memorandum................................ 34
BLACKWATER USA
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TUESDAY, OCTOBER 2, 2007
House of Representatives,
Committee on Oversight and Government Reform,
Washington, DC.
The committee met, pursuant to notice, at 10:12 a.m., in
room 2154, Rayburn House Office Building, Hon. Henry A. Waxman
(chairman of the committee) presiding.
Present: Representatives Waxman, Davis of Virginia,
Maloney, Cummings, Kucinich, Davis of Illinois, Tierney, Clay,
Watson, Lynch, Yarmuth, Braley, Norton, McCollum, Cooper, Van
Hollen, Hodes, Murphy, Sarbanes, Welch, Burton, Shays, Mica,
Platts, Duncan, Turner, Issa, Westmoreland, McHenry, Foxx,
Bilbray, and Jordan.
Also present: Representative Schakowsky.
Staff present: Phil Schiliro, chief of staff; Phil Barnett,
staff director and chief counsel; Kristen Amerling, general
counsel; Karen Lightfoot, communications director and senior
policy advisor; David Rapallo, chief investigative counsel;
John Williams and Theo Chuang, deputy chief investigative
counsels; Christopher Davis and Daniel Davis, professional
staff members; Earley Green, chief clerk; Teresa Coufal, deputy
clerk; Matt Siegler, special assistant; Caren Auchman, press
assistant; Zhongrui J.R. Deng, chief information officer;
Leneal Scott, information systems manager; Kerry Gutknecht,
William Ragland, and Miriam Edelman, staff assistants; Russell
Anello, counsel; David Marin, minority staff director; Larry
Halloran, minority deputy staff director; Jennifer Safavian,
minority chief counsel for oversight and investigations; Keith
Ausbrook, minority general counsel; John Brosnan, minority
senior procurement counsel; Steve Castor, A. Brooke Bennett,
Ashley Callen, and Emile Monette, minority counsels; Allyson
Blandford, minority professional staff member; Nick Palarino
and Larry Brady; minority senior investigator and policy
advisors; Patrick Lyden, minority parliamentarian and member
services coordinator; Brian McNicoll, minority communications
director; and Benjamin Chance, minority clerk.
Chairman Waxman. The meeting of the committee will come to
order.
Over the past 25 years, a sophisticated campaign has been
waged to privatize Government services. The theory is that
corporations can deliver Government services better and at a
lower cost than the Government. Over the last 6 years, this
theory has been put into practice.
The result is that privatization has exploded. For every
taxpayer dollar spent on Federal programs, over 40 cents now
goes to private contractors. Our Government now outsources even
the oversight of the outsourcing.
At home, core Government functions like tax collection and
emergency response have been contracted out. Abroad, companies
like Halliburton and Blackwater have made millions performing
tasks that used to be done by our Nation's military forces.
What has been missing is a serious evaluation of whether
the promises of privatizing are actually realized. Inside our
Government, it has been an article of faith that outsourcing is
best.
Today, we are going to examine the impact of privatization
on our military forces. We will focus on a specific example,
the outsourcing of military functions to Blackwater, a private
military contractor providing protective services to U.S.
officials in Iraq.
We will seek to answer basic questions. Is Blackwater, a
private military contractor, helping or hurting our efforts in
Iraq? Is the Government doing enough to hold Blackwater
accountable for alleged misconduct? What are the costs to the
Federal taxpayers?
I want to thank Erik Prince, Blackwater's founder and CEO,
for his cooperation in this hearing. As a general rule,
children from wealthy and politically connected families no
longer serve in the military. Mr. Prince is an exception. He
enlisted in the Navy in 1992 and joined the Navy SEALs in 1993,
where he served for 4 years.
We thank you for that service.
In 1997, he saw an opportunity to start his own company and
created Blackwater. He has said, ``We are trying to do for the
national security apparatus what FedEx did for the Postal
Service.''
There may be no Federal contractor in America that has
grown more rapidly than Blackwater over the last 7 years. In
2000, Blackwater had just $204,000 in Government contracts.
Since then, it has received over $1 billion in Federal
contracts. More than half of these contracts were awarded
without full and open competition.
Privatizing is working exceptionally well for Blackwater.
The question for this hearing is whether outsourcing to
Blackwater is a good deal for the American taxpayer, whether it
is a good deal for the military and whether it is serving our
national interest in Iraq.
The first part of that question is cost. We know that
sergeants in the military generally cost the Government between
$50,000 to $70,000 per year. We also know that a comparable
position at Blackwater costs the Federal Government over
$400,000, six times as much.
Defense Secretary Gates testified about this problem last
week. He said, Blackwater charges the Government so much that
it can lure highly trained soldiers out of our forces to work
for them. He is now taking the unprecedented step of
considering whether to ask our troops to sign a non-compete
agreement to prevent the U.S. military from becoming a
taxpayer-funded training program for private contractors.
There are also serious questions about Blackwater's
performance. The September 16th shooting that killed at least
11 Iraqis is just the latest in a series of troubling
Blackwater incidents.
Earlier this year, our committee examined the company's
mistakes in Fallujah where four contractors were killed and
their bodies burned. That incident triggered a major battle in
the Iraq War.
New documents indicate that there have been a total of 195
shooting incidents involving Blackwater forces since 2005.
Blackwater's contract says the company is hired to provide
defensive services, but in most of these incidents it was
Blackwater forces who fired first. We have also learned that
122 Blackwater employees, one seventh of the company's current
work force in Iraq, have been terminated for improper conduct.
We have the best troops in the world. The men and women in
our Armed Forces are extraordinarily able and dedicated. Their
pay does not reflect their value, but they don't complain. So I
have a high bar when I ask whether Blackwater and other private
military contractors can meet the performance standards of our
soldiers.
In recent days, military leaders have said that
Blackwater's missteps in Iraq are going to hurt us badly. One
senior U.S. military official said Blackwater's actions are
creating resentment among Iraqis that ``may be worse than Abu
Ghraib.'' If these observations are true, they mean that our
reliance on a private military contractor is backfiring.
The committee's investigation raises as many questions
about the State Department's oversight of Blackwater as it does
about Blackwater itself.
On December 24, 2006, a drunken Blackwater contractor shot
the guard of the Iraqi Vice President. This didn't happen out
on a mission protecting diplomats. It occurred inside the
protected Green Zone.
If this had happened in the United States, the contractor
would have been arrested and a criminal investigation launched.
If a drunken U.S. soldier had killed an Iraqi guard, the
soldier would have faced a court martial, but all that has
happened to the Blackwater contractor is that he has lost his
job.
The State Department advised Blackwater how much to pay the
family to make the problem go away and then allowed the
contractor to leave Iraq just 36 hours after the shooting.
Incredibly, internal emails document a debate over the size of
the payment. The charge d'affaires recommended a $250,000
payment, but this was cut to $15,000 because the Diplomatic
Security Service said Iraqis would try to get themselves killed
for such a large payout.
Well, it is hard to read these emails and not come to the
conclusion that the State Department is acting as Blackwater's
enabler.
If Blackwater and other companies are really providing
better service at a lower cost, the experiment of privatizing
is working. But if the costs are higher and performance is
worse, then I don't understand why we are doing this. It makes
no sense to pay more for less. We will examine this issue today
and facts, not ideology, need to guide us here.
Yesterday, the FBI announced that it launched a criminal
investigation into Blackwater's actions on September 16th. This
morning, the Justice Department sent a letter to the committee
asking that in light of this development the committee not take
testimony at this time about the events of September 16th.
Our precedent on this committee is that Congress has an
independent right to this information but, in this case,
Ranking Member Davis and I have conferred and we have agreed to
postpone any public discussion of this issue as we work with
the Department to obtain the information that the committee
lacks. For the same reason, at the request of the Justice
Department, I will ask our witness, Mr. Prince, and our State
Department witnesses on the second panel not to discuss the
September 16th incident in this public setting today.
The last point I want to make is directed to the families
of the Blackwater employees killed in Fallujah and the families
of the soldiers killed in a tragic and unnecessary accident
with Blackwater Airline, some of whom are here today.
I know many of you believe that Blackwater has been
unaccountable to anyone in our Government. I want you to know
that Blackwater will be accountable today.
We will be asking some tough questions about disturbing
actions, and I also want to assure Mr. Prince that we will be
fair and we will not tolerate any demonstrations or
disturbances from anyone attending this hearing.
Thank you, and I am looking forward to Mr. Prince's
testimony.
I want to recognize the ranking member, Mr. Davis.
[The prepared statement of Chairman Henry A. Waxman
follows:]
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Mr. Davis of Virginia. Thank you, Mr. Waxman.
Security contractors have been working at U.S. diplomatic
posts for more than 20 years, but their extensive use in the
midst of ongoing military conflict raises important new
questions about the ability of Government acquisition officials
to manage and oversee those contracts, the vetting and training
of security personnel, and how best to control and coordinate
private security firms in a complex, highly dangerous battle
space.
Contracts for the use of force in war also pose legitimate
questions about the propriety of hiring private firms to
perform such a public, some would say inherently governmental,
function. But those complex questions won't be addressed
responsibly by fixating on the operations of any one company
nor are we likely to learn much by focusing on one sensational
incident still under investigation.
So we appreciate Chairman Waxman agreeing to add testimony
from State Department witnesses today. They will discuss
overall management of the competitively awarded worldwide
personnel protective services contract under which Blackwater
and two other firms provide security services in Iraq.
We take the chairman at his word, there will be additional
hearings to examine the broader range of important oversight
issues implicated in the use of security contractors in hostile
environments.
Contractor personnel working in support of diplomatic and
military activities abroad have become an inescapable fact of
modern life. Today, they provide everything from logistics and
engineering services to food preparation, laundry, housing,
construction and, of course, security. They offer invaluable
surge capacity and contingent capabilities Federal agencies
can't afford to keep in-house.
By some estimates, the number of private contractors now
exceeds the total U.S. military personnel in Iraq, but the
presence of so many foreigners, particularly so many with guns,
offends some Iraqis and gives others a pretext to incite
mistrust and violence. To paraphrase the title of one recent
study of the phenomena, Iraqis fear they can't live with
private security contractors. U.S. personnel believe they can't
live without them.
So it is critical the Departments of State and Defense get
it right when they contract for sensitive security services in
someone else's sovereign territory.
However, you define success in Iraq, from stay the course
to immediate withdrawal and every scenario in between, security
contractors are going to play an integral part. The inevitable
redeployment of U.S. military units out of the current urban
battle space will only increase the need for well trained and
well managed private security forces to fill that vacuum and
protect diplomatic and reconstruction efforts.
As the lead editorial of this morning's Washington Post
concluded, it is foolish to propose the elimination of private
security firms in Iraq and Afghanistan, at least in the short
term.
Contract documents and incident reports reviewed by the
committee suggest the State Department is trying to get it
right. There is clear evidence of proactive management and
oversight of security contractors in Iraq.
The State Department requires specific qualifications and
rigorous ongoing training for all contract security personnel,
including extensive prior security experience and firearms
proficiency. Those hired must also undergo background
investigations and qualify for a security clearance, and the
contract contains carefully crafted comprehensive provisions on
standards of conduct for security personnel, strict rules for
the use of any type of force and extensive reporting
requirements when any incident occurs.
But State Department oversight of security contractors
seems to have some blind spots as well. There is little
aggregate or comparative data on contractor performance, so it
is impossible to know if one company's rate of weapon-related
incidents is the product of a dangerous cowboy culture or the
predictable result of conducting higher risk missions.
Incidents of erratic and dangerous behavior by security
personnel from all the companies involved, not just Blackwater,
are handled with little or no regard to Iraqi law. Usually, the
bad actor is simply whisked out of the country, whether the
offense is a civilian casualty, negligent discharge of a
weapon, alcohol or drug abuse, or destruction of property. To
date, there has not been a single successful prosecution of a
security provider in Iraq for criminal misconduct.
Iraqis understandably resent our preaching about the rule
of law when so visible an element of the U.S. presence there
appears to be above the law. That is why the events of
September 16th sparked such an outcry by the Iraqi government
which sees unpunished assaults on civilians as a threat to
national sovereignty.
The incident is also being used by those seeking to exploit
accumulated resentments and draw attacks on private
contractors, a force even the Iraqi government concedes is
still a vital layer of security.
Given that volatile environment, we should take care not to
prejudge the ongoing investigations into events of that day.
Published eyewitness statements provide very contradictory
accounts, but this much we know: Standard operating procedures
for personnel security details dictate getting protected
persons in U.S. vehicles away from an incident as quickly as
possible. No one stays to secure the scene or to help
frightened civilians. That is not their job.
So we may never know who or how many shot first. In the
time it takes to hide an AK-47, murderous insurgents and
corrupt Iraqi police can be transformed into martyred
civilians.
We need to look at the proper role of security contractors
in a war zone, not through the clouded lens of one company or
one certain incident but with a clear eye and objective view of
what best serves the interest of U.S. personnel in theater and
U.S. taxpayers at home.
I look forward to that discussion.
[The prepared statement of Hon. Tom Davis follows:]
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Chairman Waxman. Thank you very much, Mr. Davis.
While the rules do not provide opening statements for all
Members at a hearing, Mr. Davis and I have consulted about
this, and I would like to ask unanimous consent that we have
four Members on each side designated by the chairman and the
ranking member to be permitted to give a 2-minute statement.
When we begin the questioning, we will begin with 10
minutes controlled by the chairman and 10 minutes controlled by
the ranking member.
I would further like to ask unanimous consent that Jan
Schakowsky, who is not a member of this committee, be permitted
to join us at this hearing today. Is there any objection to
this unanimous consent request?
If not, that will be the order.
I would like to now call on for 2 minutes, it would be Mr.
Tierney for his statement.
Mr. Tierney. Thank you, Mr. Chairman.
Mr. Chairman, the fundamental question here ought to be
whether or not it makes sense to contract out in the first
place. We really need to evaluate our use of private military
contractors to determine what roles are appropriate or not for
private firms and what must be kept in control of those in
uniform or those in public service.
The all-voluntary professional force after the Vietnam War
employed the so-called Abrams Doctrine. The idea was that we
wouldn't go to war without the sufficient backing of the
Nation.
Outsourcing has circumvented this doctrine. It allows the
administration to almost double the force size without any
political price being paid. We have too few regular troops and
if we admitted that and tried to put in more, the
administration would have to admit it was wrong in the way it
prosecuted this war originally. It would have to recognize the
impact on drawing forces out of Afghanistan.
If we call up even more National Guards or Reservists, then
it would cause even more of a protest among the people in this
country that are already not sold on the Iraq venture. If we
relied more on our allies, they would have to share the power,
share the decisionmaking and share the contract work. So
private contractors have allowed, essentially, this
administration to add additional forces without paying any
political capital.
Very little conversation goes into the number of people
dedicated to their jobs in the private sector that are being
killed or injured on a regular basis. Figures by one account
are some nine individuals a week losing their lives in the
service of private contracting that are not counted in the
figures of casualties reported to the American people.
Outsourcing, as you indicated, Mr. Chairman, seems to
increase the costs, not decrease the costs, and I hope we get
into the numbers on that as the hearing goes on. It seems to be
harming the very counterinsurgency effort that General Petraeus
seems to want to implement, and we have far too few Government
managers to oversee the situation.
We need more accountability. We need to clarify and update
our laws. We need to restore the Government's ability to manage
any such contracts. We need to punish corporations that commit
fraud or undermine our security. Basically, we need to
reconsider which jobs should be private and which jobs should
remain in the public sector.
Thank you, Mr. Chairman.
Chairman Waxman. Thank you, Mr. Tierney.
The Chair would like to now recognize Mr. McHenry for 2
minutes.
Mr. McHenry. Thank you, Mr. Chairman.
While we are the investigative committee of Congress, I
believe it is irresponsible, when an ongoing investigation in
the executive branch is trying to establish the facts of the
September 16th event, that we call before this committee,
contractors involved with that. Establishing those facts are
included in those two ongoing investigations, and I believe it
is irresponsible for us to convict before the executive branch
has first established the facts of what did occur with the
Blackwater incident in Baghdad.
Blackwater has protected dozens, if not hundreds, of
Members of Congress including myself and members of this
committee when they travel to Afghanistan and Iraq. I, for one,
am grateful for their service. Not one single Member of
Congress has been injured nor killed under Blackwater
protection, and for that I am grateful.
Let me be clear. We should not speculate on the actions of
the men on September 16th. Those facts are not yet established.
We need to get the facts on the record on these contradicting
reports that are coming from media sources.
Much is not clear. We have conflicting media reports
written by reporters who were not present for the events. We do
not yet have an authoritative report from the executive branch
based on eyewitness accounts.
Today, we should be reviewing the rules of contracting,
investigating whether companies are following the rules, the
legal ramifications and whether the system of contracting
should be modified and improved. These are the issues that we
should be dealing with today.
Patience is a virtue when it comes to investigating
something as serious as the loss of human life. We all abhor
the loss of any human life. Justice must be served.
With thousands of soldiers, diplomats and contractors
risking their lives in such a dangerous region of the world, we
should exercise patience in this process and allow the ongoing
investigations to come to a conclusion and establish clear
facts before we complicate this process with a kneejerk
congressional hearing. Let's deal in solid facts, not simply
follow the front page stories and the dictates of trial lawyers
which this committee, it appears, has done over the last 9
months.
Chairman Waxman. The gentleman's time has expired.
Mr. McHenry. Again, contracting is the liberal cause du
jour, and we should move past that and ensure we have proper
Government service.
Thank you.
Chairman Waxman. Mrs. Maloney, you are recognized for 2
minutes.
Mrs. Maloney. Thank you, Chairman Waxman and Ranking Member
Davis for holding today's hearing to examine the heavy reliance
upon private security contractors in Iraq and Afghanistan.
There have been troubling reports about incidents involving
Blackwater where Iraqi civilians have been killed, and there
have been many, many troubling reports.
Today, we are basically going to examine the privatization
of the military. What are the costs and what are the
consequences of privatizing our military?
Blackwater guards are highly trained and, in some cases,
have been brave, yet they make six times more than our own
military. Coming from a military family where my father served
in World War II and my brother in Vietnam, I do not believe
that the Blackwater guards are any more brave or more committed
or more disciplined or more effective than the American Armed
Services.
So our basic question--mine is today--is why are we using
this service, contracting out, privatizing our military to an
organization that has been aggressive and, I would say in some
cases, reckless in the handling of their duties?
There are many questions we have on accountability and
basically why are we doing this. We were told that we were
going to contract out these security services to save the
Government money, but in fact it is costing significantly more
to pay Blackwater than it would for our own military to perform
these duties, and their actions have really undermined our
effectiveness in Iraq.
Thank you.
Chairman Waxman. Time has expired.
Mr. Burton, you are recognized for 2 minutes.
Mr. Burton. Thank you, Mr. Chairman.
I have no objection to this kind of a hearing. What really
concerns me is that there appears to be a rush to judgment, and
I don't think that should happen. It is going to be thoroughly
investigated in Iraq by Iraqis and American officials. Until we
get that, we won't know exactly what happened or who might have
made a mistake or who might have done something they shouldn't
have done.
While the hearing here is OK, I hope everybody, including
the media, will know that this is not the final report on this.
There is going to be a complete investigation.
I would like to give you a few facts. There have been 3,073
missions in the last 9 months over there by private
contractors. There were 77 involving them using weapons.
There have been 54,000 recorded attacks, 6,000 a month, and
there have been a lot of these contractors who have lost their
lives. Since 2004, there have been 42 security contractors
killed and 76 have been wounded.
This is a time when we should reevaluate or evaluate the
procedures that are being used over there. If we find, after
the investigation, there have been errors in judgment or
somebody made a downright conscious mistake, then things need
to be changed.
I would just like to say one more time, it is important to
have these hearings. Congress needs to know what went on over
there, but there should not be a rush to judgment.
I would like to say one other thing. There has not been one
Congressman or one public official that has been killed while
under the protection of these people, and that should account
for something.
With that, Mr. Chairman, I yield back my time.
Chairman Waxman. The gentleman's time has expired.
The Chair now recognizes Mr. Cummings.
Mr. Cummings. Thank you very much, Mr. Chairman.
In light of the last statement that was just made, it is
not about Blackwater and what they did or they may have done
some good things. The question is whether there is
accountability.
Blackwater, we have to question in this hearing whether it
created a shadow military of mercenary forces that are not
accountable to the U.S. Government or to anyone else.
Blackwater appears to have fostered a culture of shoot first
and sometimes kill and then ask the questions. Blackwater has
been involved in at least 195 escalation of force incidents
since 2005, an average of 1.4 shooting incidents per week.
We must seriously reassess whether these practices are
undermining our ability to accomplish our mission in Iraq.
We must also reassess how Blackwater not only affects our
mission in Iraq but also how it may negatively affect our
foreign relations efforts in the Middle East. These same
neighboring states that we need to utilize as vehicles to spur
multilateral and bilateral support as to create a political
reconciliation in Iraq.
This is about accountability, and I am going to be very
interested to hear what Mr. Prince has to say about that
accountability.
With that, Mr. Chairman, I yield back.
Chairman Waxman. The gentleman yields back his time.
The Chair recognizes Mr. Issa for 2 minutes.
Mr. Issa. Thank you, Mr. Chairman.
I think it has been made incredibly clear by the previous
statements on the Democrat side that this is not about
Blackwater when they talk about being paid six times as much,
when they talk about the President shouldn't have gone into
this war, when they talk about, they talk about.
What we are hearing today is, in fact, a repeat of the
MoveOn.org attack on General Petraeus' patriotism. What we are
seeing is that except for the 79 Members who voted against
denouncing MoveOn.org, 8 of whom are on the dais here today,
what we are seeing is what they couldn't do to our men and
women in uniform, they will simply switch targets.
The bodies were not cold in Iraq before this became a story
worth going after here in committee.
The second panel today will include people from the State
Department who will tell us about the command and control
rules, about whether or not Blackwater made mistakes, whether
they did their job and whether they are going to be continued
as a contractor. That is appropriate.
I am not here to defend Blackwater, but I am here to defend
General Petraeus and the men and women in uniform who do their
job, who were first denounced by MoveOn.org, then not denounced
by Members of Congress, many of whom are on the dais today,
speaking as though they don't support attacking in every
possible way the administration's war in Iraq.
We are going to get to the bottom of what happened on
September 16th, but quite frankly when we are done with that,
we are still going to have the same problem with all due
respect to the Members on the other side of the aisle. We do
not want military guarding State Department personnel. There is
a long tradition, in fact, of very limited military guarding of
even our embassies, a limited amount of Marines.
The fact is the State Department has a surge responsibility
in Iraq and Afghanistan. They are meeting it with private
contractors. When that ends, do we really want to have 1,500
Special Ops people working for the State Department in career
positions?
I look forward to the debate on that and not on whether
this war was ill-founded which has been the Democrats' mantra.
Chairman Waxman. The gentleman's time has expired.
The Chair would now turn to Mr. Kucinich for 2 minutes.
Mr. Kucinich. Mr. Chairman, a British polling agency has
determined that more than one million Iraqi citizens have died
as a result of the Iraq War. Opinion Research Business found
that the death rate rose to almost one in two households in
Baghdad have lost a family member since the invasion began in
2003. This report confirms the results of a survey released
last fall by Lancet, the prestigious medical magazine which
gave a conservative estimate of 650,000 innocent civilian
deaths.
Now this great human tragedy is taking place in many forms.
In today's hearing. We are investigating Blackwater's
outrageous behavior that has killed countless innocent Iraqis,
and I am deeply concerned that the Department of State appears
to have attempted to cover up Blackwater's killings rather than
seek appropriate remedies.
What are the implications of killing an innocent Iraqi?
What is this Government's position on killing of innocent
Iraqis by a U.S. citizen?
If war is privatized and private contractors have a vested
interest in keeping the war going, the longer the war goes on,
the more money they make. Eighty-four percent of the shooting
incidents involving Blackwater are where they fired first, and
Blackwater did not remain at the scene. So Blackwater's shoot
first and don't ask questions later approach undermines the
U.S.' position and jeopardizes the safety of our soldiers.
How much more do we need to know to conclude that the war
against Iraq has been a disaster for the Iraqi people and for
the people of this country as well?
I yield back.
Chairman Waxman. The gentleman yields back his time.
All opening statements have been concluded.
Oh, excuse me, there is one more, Mr. Mica for 2 minutes.
Mr. Mica. Thank you.
Well, let me try to frame the context of this hearing. I
have been on the committee for some 15 years. From the outset,
the Democrat side on the majority have tried to discredit the
President. In fact, I have a quote from a press release from
Chairman Waxman, January 10th: As part of President Bush's
revised strategy appears for Iraq, he appears likely to propose
giving large sums of taxpayer dollars to decrepit and possibly
corrupt state-owned Iraqi companies.
So we started first in these hearings to try to discredit
the President. We have tried to discredit the Ambassador. We
have tried to discredit the Secretary of Defense. We did a
great job in trying to discredit the military here, and then we
worked on the Iraqi government.
Now we are down to some of the contractors. So this is the
hearing to discredit them.
Probably one of the reasons why there is some bad news for
the other side today. It is on page 15. It is a 48 percent drop
in deaths in Iraq in 1 month. They want that good news to get
out, but on the front page, you want the other killings by
Blackwater, the contractors we are going after today.
Now if they are really intent on going after the
contractors, and I don't know what happened on the 16th. I
don't know what happened in other incidents.
But if they are really intent on going after criminal
misconduct, then we have a letter from the Department of
Justice. We have some words about not interfering in this
process, but we are interfering with both a Department of State
investigation and a criminal misconduct investigation,
potentially criminal charges.
Let me quote from some of the words: This presents serious
challenges for any potential criminal prosecution, and then
they cite case law.
So my concern, if we really want to do this, we should not
be holding this hearing. Therefore, I move that the committee
do now adjourn.
Chairman Waxman. The motion is before us to adjourn.
All those in favor of the motion, say aye.
[Chorus of ayes.]
Chairman Waxman. Opposed, no.
[Chorus of noes.]
Chairman Waxman. The noes have it and the motion is
defeated.
We have a witness now, and I would like to call forward
Erik Prince who is the head of the Prince Group, LLC and
Blackwater USA.
Mr. Prince, please come forward.
Mr. Prince, it is the practice of this committee that all
witnesses take an oath before they testify, if you will please
raise your right hand.
[Witness sworn.]
Chairman Waxman. The record will indicate that the witness
answered in the affirmative.
I do want to say, Mr. Prince, that there have been press
reports over the past 2 weeks regarding the recent incident on
September 16th, and there have been conflicting accounts of
what actually happened on the ground.
I know that you had prepared to address this incident today
as did our other witnesses and no doubt our Members did too. So
I just want to note that for the record that the request to
refrain from public comment came from the Justice Department,
not Mr. Prince and not from anyone else, and I want to thank
him for complying with that Justice Department request.
I know you had been prepared to talk about it, but we would
ask you please not to go into that incident.
Mr. Prince. Yes, sir, I would be more than happy to.
Chairman Waxman. Before you begin, just push the button the
mic.
Mr. Prince. Is that better?
Chairman Waxman. Yes. OK, please proceed however you see
fit.
STATEMENT OF ERIK PRINCE, CHAIRMAN, THE PRINCE GROUP, LLC AND
BLACKWATER USA
Mr. Prince. Chairman Waxman, Congressman Davis, members of
the committee, my name is Erik Prince, and I am the chairman
and CEO of the Prince Group and Blackwater USA.
Blackwater is a team of dedicated professionals who provide
training to America's military and law enforcement communities
and risk their lives to protect Americans in harm's way
overseas. Under the direction and oversight of the U.S.
Government, Blackwater provides an opportunity for military and
law enforcement veterans with a record of honorable service to
continue their support to the United States.
Words alone cannot express the respect I have for these
brave men and women who volunteer to defend U.S. personnel,
facilities and diplomatic missions. I am proud to be here to
represent them today.
After almost 5 years in active service as a U.S. Navy SEAL,
I founded Blackwater in 1997. I wanted to offer the military
and law enforcement communities assistance by providing expert
instruction and world-class training venues. Ten years later,
Blackwater trains approximately 500 members of the U.S.
military and law enforcement agencies every day.
After 9/11, when the United States began its stabilization
efforts in Afghanistan and then Iraq, the U.S. Government
called upon Blackwater to fill the need for protective services
in hostile areas. Blackwater responded immediately. We are
extremely proud of answering that call and supporting our
country.
Blackwater personnel supporting our country's overseas
missions are all military and law enforcement veterans, many of
whom have recent military deployments. No individual protected
by Blackwater has ever been killed or seriously injured. There
is no better evidence of the skill and dedication of these men.
At the same time, 30 brave men have made the ultimate
sacrifice while working for Blackwater and its affiliates.
Numerous others have been wounded and permanently maimed. The
entire Blackwater family mourns the loss of these brave lives.
Our thoughts and our prayers are with their families.
The areas of Iraq in which we operate are particularly
dangerous and challenging. Blackwater personnel are subject to
regular attacks by terrorists and other nefarious forces within
Iraq. We are the targets of the same ruthless enemies that have
killed more than 3,800 American military personnel and
thousands of innocent Iraqis.
Any incident where Americans are attacked serves as a
reminder of the hostile environment in which our professionals
work to keep American officials and dignitaries safe, including
visiting Members of Congress. In doing so, more American
service members are available to fight the enemy.
Blackwater shares the committee's interest in ensuring the
accountability and oversight of contract personnel supporting
U.S. operations. The company and its personnel are already
accountable under and subject to numerous statutes, treaties
and regulations of the United States. Blackwater looks forward
to working with Congress and the executive branch to ensure
that any necessary improvements to these laws and policies are
implemented.
The Worldwide Personal Protection Services Contract, which
has been provided to this committee, was competitively awarded
and details almost every aspect of operations and contractor
performance including the hiring, vetting guidelines,
background checks, screening, training standards, rules of
force and conduct standards.
In Iraq, Blackwater reports to the embassy's regional
security officer or RSO. All Blackwater movements and
operations are directed by the RSO. In conjunction with
internal company procedures and controls, the RSO ensures that
Blackwater complies with all relevant contractual terms and
conditions as well as any applicable laws and regulations.
We have approximately 1,000 professionals serving today in
Iraq as part of our Nation's total force. Blackwater does not
engage in offensive or military missions but performs only
defensive security functions.
My understanding of the September 16th incident is that the
Department of State and the FBI are conducting a full
investigation, but those results are not yet available. We at
Blackwater welcome the FBI review announced yesterday, and we
will cooperate fully and look forward to receiving their
conclusions.
I just want to put some other things in perspective. A
recent report from the Department of State stated that, in
2007, Blackwater has conducted 1,873 security details for
diplomatic business to the Red Zone, areas outside the Green
Zone in Iraq, and there have been only 56 incidences in which
weapons were discharged or less than 3 percent of all
movements.
In 2006, Blackwater conducted over 6,500 diplomatic
movements in the Red Zone. Weapons were discharged in less than
1 percent of those missions.
To the extent there is any loss of innocent life ever, let
me clear that I consider that tragic. Every life, whether
American or Iraqi, is precious. I stress to the committee and
to the American public, however, that I believe we acted
appropriately at all times.
I am prepared to answer your questions.
[The prepared statement of Mr. Prince follows:]
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Chairman Waxman. Thank you very much, Mr. Prince.
I am going to start off with the questions.
The issue before us that I see that is important to
understand is we have gone now in a major way to contract out
what the Government and what the military ordinarily would do.
Your company started off at the beginning of 2001 with, I
think, around over $200,000 in Government contracts. You now
are making over $1 billion a year. That is quite a success.
Even if I am wrong on the exact numbers, it is quite a success.
Now we are paying a lot of money for privatized military to
do the work that our military people have done, and no one does
this work better than the U.S. military. They are a very able
and brave and courageous people that do a fantastic job for us.
So the question in my mind is are we paying more and
getting less?
In asking that question, I want to focus on a particular
incident. That incident received almost no public attention but
involved the tragic loss of three of our troops, and my staff
has reviewed the documents describing the incident. They
prepared a memo which I would like, without objection, to make
part of the record.
[The information referred to follows:]
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Chairman Waxman. On November 27, 2004, there was a plane
run by Blackwater Aviation that crashed into a wall of a canyon
in the mountains of Afghanistan. This plane was carrying three
military personnel, three active duty U.S. personnel:
Lieutenant Colonel Michael McMahon, Chief Warrant Officer
Travis Grogan, and Specialist Harley Miller.
About 40 minutes after takeoff, Blackwater 61 crashed into
the wall of a canyon and all the occupants were killed. The
crash was investigated by a joint Army and Air Force taskforce
and by the National Transportation Safety Board.
The NTSB report found that Blackwater captain and first
officer behaved unprofessionally and were deliberately flying
the non-standard route low through the valley for fun. The
report found that the pilots were unfamiliar with the route,
deviated almost immediately after takeoff and failed to
maintain adequate terrain clearance.
They also had a transcript of the cockpit voice recording,
and on this recording the flight crew joked with each other,
saying, ``You are an X-wing fighter Star Wars man and you
are,'' expletive ``right. This is fun.''
The captain stated, ``I swear to God they wouldn't pay me
if they knew how much fun this was.''
Mr. Prince, one allegation raised recently about
Blackwater's actions is that your contractors have acted
irresponsibly. One senior U.S. commander told the Washington
Post ``They often act like cowboys.''
Let me ask you about that crash of Blackwater Flight 61. In
this case, did Blackwater's pilots act responsibly or were
they, in the words of the U.S. commander, acting like cowboys?
Mr. Prince. I disagree with the assertion that they acted
like cowboys. We provide a very reliable, valuable service to
the Air Force and the Army in Afghanistan. Anytime you have an
accident, it is an accident. Something could have been done
better.
It is not a Part 135 U.S. type flying operation. There are
no flight services. There are no flight routes. There are no
nav aids. It is truly rugged Alaska-style bush flying.
Chairman Waxman. Well, the investigators said from the
National Transportation Safety Board that Blackwater Aviation
violated its own policies by assigning two pilots without
adequate flying experience in Afghanistan. According to the
military report, it was your policy, Blackwater policy, that
required at least one of the pilots to have flown in theater
for at least a month, but neither pilot had flown for that long
and neither had flown the route they were assigned that day.
This is clear in the cockpit voice recording. Right after
takeoff, the Blackwater captain said, ``I hope I am going into
the right valley.''
The first one replied, ``This one or that one?''
The captain then apparently guessed which valley to fly,
saying, ``I am just going to go up this one.''
The flight mechanic later observed, ``We don't normally go
this route.''
Why didn't Blackwater follow its own policies and team two
new pilots with more experienced ones? Why did you have two
inexperienced pilots together?
Mr. Prince. I am not qualified to speak to the experience
level of the pilots. I will tell you that we are operating
under military control. In fact, the aircraft was set to take
off with two passengers onboard, and they actually turned
around for the lieutenant colonel who I believe who boarded
late.
There was also it violated. The military violated its
policy by loading both ammunition. That aircraft is also flying
with a large number of illumination mortar rounds, and they are
not supposed to mix pax and cargo. But, again, we followed our
customer's instructions.
Yes, accidents happened. We provided thousands and
thousands of flight hours of reliable service since then. Today
still, we are flying more than 1,000 missions a month.
Chairman Waxman. But on that one, the investigators found
that Blackwater failed to follow standard precautions to track
flights, failed to file a flight plan, failed to maintain
emergency communications in case of an accident, and tragically
these failures may have cost the life of the crash's sole
survivor because one of the military people that you were
escorting or your flight was escorting evidently survived for
at least 10 hours after the crash.
He suffered internal injuries, but he got out of the plane
to urinate. He smoked a cigarette. He rolled out a sleeping
bag. Nobody came, and then he died of cold from inattention.
There was no way, as required, for anybody to know where that
plane had landed even though that is a requirement.
I have an email that I want to read to you. It was sent on
November 10, 2004, 16 days before the crash. It is from Paul
Hooper, Blackwater Afghanistan site manager, and it was sent to
John Hite, vice president for operations for Blackwater
Aviation.
In it, Mr. Hooper says, Blackwater knowingly hired pilots
with background and experience shortfalls.
Here is what he wrote: ``By necessity, the initial group
hired to support the Afghanistan operation did not meet the
criteria identified in email traffic and had some background
and experience shortfalls overlooked in favor of getting the
requisite number of personnel on board to startup the
contract.''
One of the great ironies of this accident is that while the
aircraft was being piloted by an inexperienced Blackwater
pilot, a skilled military pilot with an exemplary safety
record, Lieutenant Colonel Michael McMahon was on board the
flight as a passenger.
This is what his widow wrote to me. She is Colonel Jeanette
McMahon, and she works at West Point.
She said, ``Mike, like Mr. Prince, was a CEO of sorts in
the military as an aviation commander and as such had amassed a
great safety record in his unit. It is ironic and unfortunate
that he had to be a passenger on this plane versus one of the
people responsible for its safe operation. Some would say it
was simply a tragic accident . . . but this accident was due to
the gross lack of judgment in managing this company.''
Mr. Prince, Colonel McMahon is asking why the taxpayers
should be paying your company millions to conduct military
transport missions over dangerous terrain when the military's
own pilots are better trained and a lot less expensive. How do
you respond?
Mr. Prince. We were hired to fill that void because there
is a different--it is a different kind of airlift mission going
in and out of the very short strips in Afghanistan. You have
high altitude, short strips, unimproved runways, and you have
transport aircraft that are designed to support a large
conventional battle.
We are doing small missions. The typical CASA payload maxes
out at 4,000 pounds. They can't even hold that because of the
short altitude or the high altitude short strips, they have to
go in and out of, hauling mail, hauling parts.
We are filling that gap because these strips are too small
for C-17s. They are too small for C-130's. They are going in
and out of places that the military can't get to with existing
aircraft they have. That is why we are doing that mission.
Chairman Waxman. You are saying that the military could not
do this job?
Mr. Prince. They did not have the assets to do it in
theater or back in the United States, no, sir.
Chairman Waxman. They could have acquired those assets,
however. Instead, they hired you.
Mr. Prince. I believe the Congress has seen fit to proceed
with some sort of aircraft acquisition program to fill that
void going forward, but this is a temporary service to fill
that gap.
Chairman Waxman. Well, we have been in Iraq for 5 years
now. The pilots of Blackwater 61 paid for their errors with
their lives, but I am wondering whether there was any corporate
accountability for Blackwater. Were any sanctions placed on the
company after the investigative reports that were so critical
of Blackwater were released?
Mr. Prince. Anytime there is an accident, a company also
should be introspective and look back and see what can be done
to make sure that it doesn't happen again.
Chairman Waxman. Aside from your introspection, were you
ever penalized in any way? Were you ever fined or suspended or
reprimanded or placed on probation?
Mr. Prince. I believe the Air Force investigated the
incident, and they found that it was. It was pilot error. It
was not due to corporate error that caused the mistake or that
crashed the aircraft.
Chairman Waxman. My time is up, but the corporation hired
inexperienced pilots. They sent them on a route they didn't
know about. They didn't even follow your own rules. It seems to
me that it is more than pilot error. There ought to be
corporate responsibility, and Blackwater was the corporation
involved.
Aside from your introspection, you have just been awarded a
new contract for almost $92 million. I want to see whether you
are getting a stick as well as all these carrots.
Mr. Davis, your turn.
Mr. Davis of Virginia. Thank you, Mr. Chairman.
Let me just say I think if there is a question if they
should be in or out, if the private companies are doing work of
the Army, that really ought to be addressed by the Defense
Department and State Department.
Mr. Issa. Mr. Chairman.
Mr. Ranking Member, would you yield for a question?
Mr. Davis of Virginia. I would.
Mr. Issa. Since I wasn't here during the Clinton
administration, did Mr. Waxman and this committee investigate
Secretary Brown's crash in which he was killed?
That was a military flight, C-130, I believe. Was that
investigated?
Mr. Davis of Virginia. I wasn't here. I was not here at
that point, but I understand the question.
Mr. Issa. So crashes happen bad weather and in combat.
Chairman Waxman. Will the gentleman yield to me?
That crash was investigated, and the gentleman would be
able to get the report of that investigation.
Mr. Davis of Virginia. Let me yield 5 minutes to the
gentleman from North Carolina.
Mr. McHenry. I thank the ranking member for yielding.
Mr. Prince, can you describe to the committee the nature of
your contract, who your client is in Iraq?
Mr. Prince. In Iraq, we work for the Department of State.
Mr. McHenry. What is the service you provide for the
Department of State?
Mr. Prince. We operate under the Worldwide Personal
Protective Services Contract, and we are charged with
protecting diplomats, reconstruction officials and visiting
CODELs, Members of Congress and their staffs.
Mr. McHenry. In this calendar year, how many missions have
you had in Iraq?
Mr. Prince. 1,873.
Mr. McHenry. How many incidents occurred during those 1,873
movements?
Mr. Prince. Only 56 incidents.
Mr. McHenry. A movement is, for instance, a Member of
Congress lands at the airstrip. They are transported to the
embassy. That is one movement.
Mr. Prince. Yes, sir.
Mr. McHenry. All right, and 56 incidents out of 1,873
movements in a war zone, is that correct?
Mr. Prince. Resulted in a discharge of one of our guys'
weapons.
Mr. McHenry. Those 56 incidents, does that mean that they
shot at someone? Describe what an incident is.
Mr. Prince. Yes. We don't even record all the times that
our guys receive fire. The vehicles get shot at on a daily
basis, multiple times a day. So that is not something we even
record.
In this case, an incident is a defensive measure. You are
responding to an IED attack followed by small arms fire.
Most of the attacks we get in Iraq are complex, meaning it
is not just one bad thing; it is a host of bad things. Car bomb
followed by small arms attack. RPGs followed by sniper fire.
An incident occurs typically when our men fear for their
life. They are not able to extract themselves from the
situation. They have to use sufficient defensive fire to off
the X, to get off that place where the bad guys have tried to
kill Americans that day.
Mr. McHenry. So in 1,873 missions, 56 incidents occurred
which means potentially the Blackwater individual, the former
soldier in most cases, discharges a weapon. Perhaps in the air,
is that a possibility?
Mr. Prince. It is not likely into the air. It is either
going to be directed at someone that is shooting at us or
another real problem. You know the recent Washington Post
series on IEDs in Iraq, 81,000 IED attacks.
The bad guys have figured out how to make a precision
weapon. You take a car. You pack it with explosives, and you
put a suicidal person in there that wants to drive into the
back of a convoy and blow themselves up.
Mr. McHenry. An additional question here, those 56
incidents pretty much all involved returning fire. A caravan is
being shot at, for instance, and you would return fire or a
potential car bomb is coming at you and you are returning.
Mr. Prince. A potential car bomb, yes. Defensive fire or
potential car bombs going, potentially coming near you, you
have to warn them off.
There is a whole series in the use of force continuum that
our guys are briefed and they abide by. They are briefed on it
through their training back here in the United States.
Every time they leave the wire, every time they launch on
that mission, before they go in the morning, they get the
mission brief on what they are going to do, who they are
protecting, where they are going, the intelligence, what to be
on the lookout for, where have there been particularly bad
areas in the city and the use of force continuum, those rules
of engagement.
Mr. McHenry. The use of force continuum, is that dictated
by the Department of State?
Mr. Prince. Yes.
Mr. McHenry. You use their rules of engagement, the
commonly used term?
Mr. Prince. Yes, sir.
Mr. McHenry. That is similar to the Department of Defense
rules of engagement.
Mr. Prince. Yes, they are essentially the same.
Mr. McHenry. OK. So you had 1,800.
Mr. Prince. Sorry, Department of Defense rules for
contractors. We do not have the same as a U.S. soldier at all.
Mr. McHenry. OK. In the report that I have, in 2006, you
had 6,254 missions and 38 incidents.
Mr. Prince. Yes, sir.
Mr. McHenry. Which means one of the contractors, one of the
former soldiers, who is now in State Department Protective
Service, they returned fire. So that would be less than 1
percent of missions involved returning fire.
The question here, how long has Blackwater been involved in
Iraq? How long have you had this contract in Iraq?
Mr. Prince. We started there first working for DOD under
the CPA, and then I believe in 2005 it transitioned from CPA
over to Department of State.
Mr. McHenry. How many individuals under your protective
service have been injured or killed?
Mr. Prince. Twenty-seven dead and hundreds wounded.
Mr. McHenry. How many individuals?
Mr. Prince. Oh, under our care?
Mr. McHenry. Under your care that you are protecting.
Mr. Prince. Zero.
Mr. McHenry. Zero?
Mr. Prince. Zero, sir.
Mr. McHenry. Zero individuals that Blackwater has protected
have been killed in a Blackwater transport.
Mr. Prince. That is correct.
Mr. McHenry. Zero?
Mr. Prince. Zero.
Mr. McHenry. That is, I think, the operable number here.
Your client is the State Department. The State Department has a
contract with you to provide protective service for their
visitors, for instance, CODELs, Ambassadors and runs the gamut,
and you have had zero individuals under your care and
protection killed.
Mr. Prince. Correct.
Mr. McHenry. I think that is a very important number that
we need to discuss here, Mr. Chairman, and that should be a
testament to the service that these former veterans, these
veterans that are currently working for Blackwater.
Chairman Waxman. The 5 minutes that was yielded to you is
over.
Mr. McHenry. I am happy to yield back to the ranking
member.
Mr. Davis of Virginia. Mr. Prince, let me just continue
with that. Are there any other security firms in Iraq that
provide the services that involve as much danger as your escort
services that your company provides in Baghdad?
Mr. Prince. Sir, we certainly have a high profile mission.
We protect the U.S. Ambassador. We protect all the diplomats in
the greater Baghdad area which is the hottest part of the
country by far.
Mr. Davis of Virginia. How is your firm paid under the
current task order contract for security details? Is it by the
mission, by the hour or some other method?
How do you bill the Government?
Mr. Prince. It is generally billed on a per man day for
every day that the operator is in the country.
Mr. Davis of Virginia. Is it a cost plus fee or is it just
like a time and materials?
Mr. Prince. It is blended. Most of it is firm fixed price.
There are a few things that are directly cost reimbursable like
insurance.
Mr. Davis of Virginia. Does the contract provide for
monetary penalties for any performance difficulties like
shooting incidents that were reported to have occurred and the
like?
Mr. Prince. Yes, there are sorts of penalty clauses, if we
don't have it fully manned, if they are not happy with the
leadership. We are very responsive. If there is someone that
doesn't agree or is not operating within the standards of the
Department of State, they have two decisions, window or aisle.
Mr. Davis of Virginia. Do you work just for the Department
of State or do you work for the Defense Department as well?
Mr. Prince. In Iraq, we essentially work for the Department
of State. There are one or two folks here or there in a
consultant type position but nothing, nothing significant,
nothing armed.
Mr. Davis of Virginia. It is important for the committee to
understand there are two different contracting entities that
are contracting in Iraq, and you work for State.
Do you think the contract provisions and the State
Department contract management personnel provide sufficient
guidance for the use of force under the contract?
Mr. Prince. Yes, sir. We have seen the full gamut of
contracting and contract management in the stabilization
section or stabilization phase of the Iraq War, and there is a
whole host of differences in oversight.
I will tell you the State Department is the highest. They
are the GE-like buyers, the most sophisticated oversight
standards that we have to comply with on the front end for our
personnel and management in the field.
Mr. Davis of Virginia. When your teams are operating on the
ground in Baghdad, what entity has the authority to control
your activities? Is it the State Department or is it the
military commander who is responsible for the battle space?
Mr. Prince. We work for the RSO, the regional security
officer. He is the chief security official for the State
Department in Iraq.
Mr. Davis of Virginia. So it is the State Department
ultimately for whom you are contracting.
Mr. Prince. Yes.
Mr. Davis of Virginia. Can you describe the process that is
followed under the contract when a shooting incident occurs?
Have you dismissed any employees for shooting incidents
under your security contracts in Iraq and what happens to
dismissed employees? Are they sent out of Iraq?
Mr. Prince. OK, let me answer the last one first.
If there is any sort of discipline problem, whether it is
bad attitude, a dirty weapon, riding someone's bike that is not
his, we fire them. We hold ourselves internally accountable,
very high. We fire them. We can fine them, but we can't do
anything else.
So if there is any incidents where we believe wrongdoing is
done, we present that incident, any incident, any time a weapon
is discharged, there is an incident report given to the RSO.
Mr. Davis of Virginia. Any idea how many employees you have
fired over the time?
Mr. Prince. I think in the committee's report, they said
122 or something over.
Mr. Davis of Virginia. So you have taken action when it has
come to your attention.
Mr. Prince. Say again, sir.
Mr. Davis of Virginia. So you have taken action when it has
come to your attention.
Mr. Prince. It generally comes to our attention first. We
as a company, we fire them. We send the termination notice to
the State Department as to why we fired someone.
Mr. Davis of Virginia. Thank you.
Chairman Waxman. The gentleman's time has expired.
Mrs. Maloney for 5 minutes.
Mrs. Maloney. Thank you, Mr. Chairman.
I would like to ask you, Mr. Prince, about one of these
employees whom you fired, and this was an employee who got
drunk on Christmas Eve of 2006. According to documents that we
got yesterday from the State Department, this particular man,
while he was drunk, shot and killed the guard to the Iraqi Vice
President, obviously causing great tensions between the Iraqi
government and the U.S. military.
I would like to ask you about his firing. You fired this
individual for handling a weapon and for being intoxicated, is
that right?
Mr. Prince. The men operate with a clear policy. If there
is to be any alcohol consumed, it is 8 hours between any time
of consumption of alcohol.
Mrs. Maloney. Was he fired or not?
Mr. Prince. Excuse me?
Mrs. Maloney. Was he fired?
Mr. Prince. Oh, yes, ma'am, he was fired.
Mrs. Maloney. Have any charges been brought against him in
the Iraqi justice system?
Mr. Prince. I don't believe in the Iraqi justice system. I
do believe. I know we referred it over to the----
Mrs. Maloney. Justice Department, they told us they are
still looking at it 9 months later.
Have any charges been brought against him in the U.S.
military justice system?
Mr. Prince. I don't know.
Mrs. Maloney. Have any charges been brought against him in
the U.S. civilian justice system?
Mr. Prince. Well, that would be handled by the Justice
Department, ma'am. That is for them to answer, not me.
Mrs. Maloney. Other than firing him, has there been any
sanction against him about any Government authority?
You mentioned you fined people for bad behavior. Was he
fined for killing the Iraqi guard?
Mr. Prince. Yes, he was.
Mrs. Maloney. How much was he fined?
Mr. Prince. Multiple thousands of dollars, I don't know the
exact number. I will have to get you that answer.
Mrs. Maloney. OK.
Mr. Prince. Look, I am not going to make any apologies for
what he did. He clearly violated our policies.
Mrs. Maloney. OK. All right. Every American believes he
violated policies. If he lived in America, he would have been
arrested, and he would be facing criminal charges. If he was a
member of our military, he would be under a court martial. But
it appears to me that Blackwater has special rules. That is one
of the reasons of this hearing.
Now, within 36 hours of the shooting, he was flown out of
Iraq. Did Blackwater arrange for this contractor to leave Iraq
less than 2 hours after the shooting?
Mr. Prince. I do not believe we arranged for him to leave
after 2 hours after the shooting. He was arrested.
Mrs. Maloney. OK, what about 2 days? It was 2 days after
the shooting.
Did Blackwater arrange for him to leave the country?
Mr. Prince. That could easily be.
Mrs. Maloney. OK.
Mr. Prince. IZ Police arrested him. There was evidence
gathered. There was information turned over to the Justice
Department office in Baghdad. We fired him. He certainly didn't
have a job with us.
Mrs. Maloney. Well, in America, if you committed a crime,
you don't pack them up and ship them out of the country in 2
days.
If you are really concerned about accountability, which you
testified in your testimony, you would have gone in and done a
thorough investigation. Because this shooting took place within
the Green Zone, this was a controllable situation. You could
have gone in and done forensics and all the things that they
do, but the response was to pack him and have him leave the
country within 2 days.
I would like to ask you, how do you justify sending him
away from Iraq when any investigation would have only just
begun?
Mr. Prince. Again, he was fired. The Justice Department was
investigating. In Baghdad, there is a Justice Department office
there.
He didn't have a job with us anymore. We as a private
company cannot detain him. We can fire, we can fine, but we
can't do anything else. The State Department----
Mrs. Maloney. What evidence do you have that the Justice
Department was investigating him at that time?
Mr. Prince. From talking to my program management people in
the country, they said it is in the hands of the IZ Police,
which is Air Force, arrested him. They took him in for
questioning. It was handled by the Justice Department.
He was fired by us. The State Department ordered.
Mrs. Maloney. Well, it has been 10 months, and the Justice
Department has not done anything to him. Again, I repeat, if he
was a U.S. citizen or in America, he would have been arrested
immediately. He would have faced criminal charges.
We know about the chain of command in the military. They
are court-martialed immediately.
But if you work for Blackwater, you get packed up and you
leave within 2 days and you face a $1,000 fine.
So I am concerned about accountability and really the
unfairness of this, and I am concerned about how Blackwater--if
I could just say, Mr. Chairman--your actions may be undermining
our mission in Iraq and really hurting the relationship and
trust between the Iraqi people and the American military.
Chairman Waxman. The gentlelady's time has expired.
Mr. Burton.
Mr. Burton. Can you tell us, Mr. Prince, how many people
witnessed the incident she just referred to?
Mr. Prince. I don't believe anyone did, sir.
Mr. Burton. So the only people who were involved was the
man who was shot and your employee?
Mr. Prince. Yes, sir.
Mr. Burton. Can you, in some detail, go into the rules of
engagement?
I have talked to some of the people at State Department
about this, and I have talked to people within your
organization. As I understand it, on the back of every one of
your vehicles, in both Arabic and English, there is a warning
to not get 100 meters of that vehicle, is that correct?
Mr. Prince. Yes, that is right, sir.
Mr. Burton. If somebody is coming at your vehicle at a high
rate of speed, do your employees have any actions that they
should take especially if it might be a car bomb or something
like that?
Mr. Prince. Yes, sir. There are generally lights and sirens
on the vehicles, air horn. The personnel, whose security sector
is facing back toward that oncoming threat, will be giving hand
signals, audible yelling, stop, qif, Arabic for stop.
There is a pin flare, which is a signaling device kind of
like a bottle rocket. It is the device used for a pilot to
signal his whereabouts on the ground to be rescued, but it is a
bright incendiary device that flies by the vehicle or it hits
the vehicle. It is not lethal at all, but definitely you know
something is happening.
Water bottles are sometimes thrown at vehicles to warn them
off.
If you have to go beyond that, they take shots into the
radiator. You hear that hitting the car. It disables the car.
Definitely, you know something is happening.
If they go beyond that, they spider the windshield. You put
a round through the center of the windshield away from the
occupants so that the safety glass in the windshield makes it
difficult to see through.
Only after that do they actually direct any shots toward
the driver. So there is a whole use of force continuum.
Mr. Burton. The questions that I have heard today from the
other side indicate that there ought to be perfection in your
organization. Now you are a Navy SEAL, and you served in the
military. Do you believe that any kind of military operation of
this type or any type can be absolutely perfect all the time?
Mr. Prince. I am afraid not, sir. We strive for perfection.
We try to drive toward the highest standards, but the fog of
war and accidents and the bad guys just have to get lucky once.
Mr. Burton. I think it is very important that everybody who
is involved in this hearing today understand that you have high
public officials, Congressman and others, whom you have to
protect, and you have indicated that nobody has been killed or
hurt under your protection. Yet, you are going through all
kinds of zones where there are car bombs going off, small arms
fire, cars coming at you at high rates of speed.
Can you explain to me why in the world there wouldn't be
some precautions taken when those sorts of things take place?
Mr. Prince. Again, the bad guys have figured out killing
Americans is big media, I think. They are trying to drive us
out. They try to drive to the heart of American resolve and
will to stay there.
So we have to provide that protective screen. We only play
defense, and our job is to get those reconstruction officials,
those people that are trying to weave the fabric of Iraq back
together, to get them away from that X, the place where the bad
guys, the terrorists, have decided to kill them that day.
Mr. Burton. One of the Members on the other side indicated
that when there is a firefight or when there is a car bomb
going off or something, there is an attack on your convoy, that
you don't stay there.
Can you explain to me what would happen if you stayed there
when you were under attack?
Mr. Prince. Again, there would be a lot more firefight.
There would be a lot more shooting.
Our job is to get them off the X. The X is what we refer to
in our business about the preplanned ambush site where bad guys
have planned to kill you. So our job is to get them away from
that X, to get them to a safe place. So we can't stay and
secure the terrorist crime scene investigation.
Mr. Burton. You are in a war zone.
Mr. Prince. Yes, sir.
Mr. Burton. So, the instructions, I want to get this
straight. If your people come under fire or there is a car bomb
or RPG fired at them, they are supposed to turn around under
some rules and get out of there to protect the people that they
are guarding.
Mr. Prince. Yes, sir, defensive fire, sufficient force to
extricate ourselves from that dangerous situation. We are not
there to achieve firepower dominance or to drive the insurgents
back. We are there to get our package away from danger.
Mr. Burton. Thank you.
Chairman Waxman. The gentleman's time has expired.
The Chair now recognizes Mr. Cummings for 5 minutes.
Mr. Cummings. Mr. Prince, you are a very impressive
witness. I just want to ask you a few questions that cause me
some concern that seems to go counter to some of the things
that you have said.
I am wondering whether Blackwater is actually helping our
military or hurting them. Frankly, I am concerned that the
ordinary Iraqi may not be able to distinguish military actions
from contractor actions. They view them all as American
actions.
Now I want to go back to this incident that we have been
talking about for the last few minutes, the 2006 Christmas Eve
incident where the drunken Blackwater official shot and killed
a guard of the Iraqi Vice President, which is basically like
killing a Secret Service person guarding our Vice President.
When this incident first happened, an Arab television
station ran an incorrect story, saying that a ``drunken U.S.
soldier'' killed the Iraqi Vice President's guard.
Were you aware of this incorrect press report?
Mr. Prince. No, sir, I was not.
Mr. Cummings. Of course, you can see how a media report
like that makes it more likely that Iraqis will blame the U.S.
military rather than Blackwater for the killing of the Iraqi
Vice President's guard. Again, what if it were our Vice
President?
Did Blackwater take any steps to inform the press that it
was actually a Blackwater employee who killed the Vice
President's guard?
Mr. Prince. By contract, we are not allowed to engage with
the press.
Mr. Cummings. All right, and why is that?
Mr. Prince. That is part of the stipulations in the WPPS
contract.
Mr. Cummings. After this report aired, an official who
works for you--and this is what really concerns me and I just
want to know your reaction to this--at Blackwater sent an
email.
This is an employee of yours sent an email internally to
some of his colleagues. He did not suggest contacting the
station, I guess, for the reason you just said. He didn't
suggest putting out a press release, and he didn't suggest
correcting the false story in any way.
Instead, this is what the email said: ``At least the ID of
the shooter will take the heat off of us,'' meaning Blackwater.
In other words, he was saying: Wow, everyone thinks it was
the military and not Blackwater. What great news for us. What a
silver lining.
Mr. Prince, you said in your testimony that Blackwater is
extremely proud of answering the call and supporting our
country. Did anyone in your organization ever raise any
concerns that a lying, a false story to continue might lead to
retaliation or insurgent activity against our troops?
Mr. Prince. I don't believe that false story lasted in the
media for more than a few hours, sir.
Mr. Cummings. But the fact still remains that it was a
false story, and we are trying to be supportive of the Iraqi
government, trying to get this reconciliation, trying to make
sure that they, as President Bush says, that they stand up so
that we can stand down.
But, at the same time, when these stories are put out--I
think you would agree--that the Iraqi people then say, well,
wait a minute, the United States is supposed to be supporting
our Government.
President Bush talks about how we have gone over to export
democracy. Here is the very symbol. The Vice President of a
country, killed by a drunken Blackwater employee.
The question is then what lies in the mind of the Iraqi?
What lies in the minds of those people who may have wanted to
cooperate with our security over there?
Then they say, well, wait a minute, if they, U.S. soldiers,
but really Blackwater is doing this to the very Government that
we are supposed to be supporting. Then what does that say and
why should we support the United States? Fair question?
Mr. Prince. Yes, sir. Look, I am not going to make any
apologies for the----
Mr. Cummings. I am not asking you to make any apologies.
You are the president of this company, is that right?
Mr. Prince. The CEO.
Mr. Cummings. CEO, well, you are the top guy. You are one
of the top guys, is that right?
Mr. Prince. Pretty much, yes, sir.
Mr. Cummings. All right. So I am just asking you a question
about what your policies are. That is all.
Mr. Prince. We have clear policies. Whether the guy was
involved in a shooting that night or not, the fact that he
violated the alcohol policy with firearms would have gotten him
fired on the spot. That is why we fire people. We hold them
independently accountable.
The guy slipped away from the party. He was by himself. I
am confident that if he had been with another guy from
Blackwater, the other guy would have stopped him and said,
enough. You know.
Mr. Cummings. So contrary to what Mr. Burton said, this was
after hours in the Green Zone, wasn't it? This wasn't some
mission, was it?
Mr. Prince. Correct.
Mr. Cummings. Right.
Mr. Prince. He was on his own time. It was a Christmas Eve
party.
Mr. Cummings. Do you understand what I mean? I have heard
not a lot of complimentary things about what you all are doing.
I am sure you are doing a great job, but it is not about what
you do well. It is a question of when things go wrong, where is
the accountability?
Mr. Prince. And, sir, we fired him. We fined him. But we,
as a private organization, can't do any more. We can't flog
him. We can't incarcerate him. That is up to the Justice
Department. We are not empowered to enforce U.S. law.
Mr. Cummings. Do you think more should be done?
Mr. Prince. I would be happy to see further investigation
and prosecution by the Justice Department, yes, sir.
Mr. Cummings. Thank you.
Chairman Waxman. I am going to call Mr. Mica next.
How much did you fine him?
Mr. Prince. Multiple thousands of dollars, sir. I don't
know the exact number, but whatever we had left due him in pay,
I believe we withheld and plus his plane ticket.
Chairman Waxman. Thank you.
Mr. Mica.
Mr. Mica. Thank you.
Mr. Prince, in your testimony earlier, you said, ``Killing
Americans, I guess, in Iraq is big media.''
You said that?
Mr. Prince. Yes, sir.
Mr. Mica. Did you have any idea that wounding American
contractors in a congressional hearing would be this big media?
Mr. Prince. More than I bargained for, sir, yes.
Mr. Mica. I described you are here because you are sort of
in the chain of command to be attacked next by some folks who
want to discredit what you are doing. I might say that I don't
know if there were criminal acts committed, and there will
probably be ways in which we can go after folks. One of those
would be to have the Department of Justice pursue the case.
Would that be the normal procedure?
Mr. Prince. Yes, sir. We welcome it. We encourage it. We
want that accountability. We hold ourselves internally
accountable, but you know we put 1,000 guys out in the field.
Humans make mistakes and they do stupid things sometimes. We
try to catch those as much as we can, but if they go over the
line.
Mr. Mica. Well, they criticized you. I guess we could start
with the pilots and the NTSB investigation. They should go back
and look at the Comair crash in Kentucky with the accounts of
the pilots which was a distraction and led to the crash
according to their findings. I have chaired the Aviation
Subcommittee and followed that very closely.
Basically, as Al Gore would put it, there is no controlling
authority for airspace in Afghanistan.
Mr. Prince. There is no FAA in Afghanistan.
Mr. Mica. Then you were criticized, too. You left the
pilot. I guess he survived but was not found. Is that it?
Mr. Prince. No. There were two of the DOD personnel in back
survived the crash.
Mr. Mica. Survived, OK. Well, two survived and weren't
found, and I guess they perished.
Mr. Prince. They perished before they were found.
Mr. Mica. I guess in the United States, like we have an
experienced pilot like Fossett. He is lost. Have we found him
yet?
Mr. Prince. No, sir.
Mr. Mica. OK, but this is in the terrain.
Mr. Prince. Terrain very similar to what is in Nevada.
Mr. Mica. I just want to try to put things in perspective.
There is also some argument that you cost the Government
too much and that you are getting paid too much and maybe this
is something that the military should be doing. Could you
respond to that?
Mr. Prince. Yes, sir. I think there are three arguments for
or against privatization. There is reliability, there is
accountability, and there is cost.
Accountability issues can be handled by exercising MEJA.
Congress expanded MEJA at the end of 2004 to any DOD
contingency operation, I believe. So any time a U.S. contractor
is abroad, they can be brought up on charges on behalf of the
U.S. Government. They can be brought up on charges back here in
the States.
There is reliability. That comes down to, I think,
individual vendor reliability. How well does that company
execute? Are they complete, correct and on time?
And then there is cost. The American automotive industry,
any manufacturer in America has to deal with that cost issue
all the time, whether they should make something. It is that
make versus buy argument.
I greatly encourage Congress to do some true activity-based
cost studies. What do some of these basic Government functions
really cost? Because I don't believe it is as simple as saying,
well, this sergeant costs us this much because that sergeant
doesn't show up there naked and untrained. There are a whole
bunch of other costs that go into it.
So, figure out if the Army does the job, how many of those
people leave the wire every day? What is their tooth to tail
ratio? How many people are operators versus how many people are
support people? That all drives into what your total cost is.
Now American industry got pushed by the Japanese car makers
and you know by foreign competitors because you have to focus
on cost and being efficient in delivering a good or a product
or a service at a better competitive price.
Mr. Mica. Finally, you were criticized for not detaining
someone who committed a criminal act. Now if an employee
commits a criminal act in the United States, and you fire him,
are you responsible in the United States for detaining him and
handling?
Mr. Prince. Well, that would be a crime that we committed
then because we are not allowed to detain.
Mr. Mica. You are not allowed to detain?
Mr. Prince. No, sir.
Mr. Mica. OK. So, in that situation, you were criticized
for providing someone transport back. Was it to the United
States?
Mr. Prince. It was.
Mr. Mica. Or wherever.
Mr. Prince. We acquired an airline ticket for him back to
the States. That is all by direction of the State Department.
Chairman Waxman. The gentleman's time has expired.
Now the Chair recognizes Mr. Kucinich.
Mr. Kucinich. Thank you very much, Mr. Chairman.
In my opening remarks, I pointed out that if war is
privatized, private contractors have a vested interest in
keeping the war going. The longer the war goes on, the more
money they make.
I want to, for my time here, explore the questions
regarding how Blackwater got its contracts.
Mr. Prince, your company has undergone a staggering growth
just over the past few years. The committee's attention can be
directed to the chart. In 2000, your company was bringing in
only about $200,000 in Government contracts but since then,
according to the committee, you have skyrocketed to something
in the nature of $1 billion in Government contracts.
The real increase in Blackwater's contracts began with the
Iraq War. In fact, if you look at the chart, you can see how
from 2004 on, the amount of taxpayer dollars Blackwater was
awarded by the administration began to go through the roof from
about $48 million in 2004 to $350 million in 2005 to over $500
million last year.
This is really an unprecedented rate of increase, and I
want to understand how this happened, Mr. Prince.
We have been informed that one of your first contracts in
Iraq was for the Coalition Provisional Authority. Ambassador
Paul Bremer awarded you a contract to protect officials and
dignitaries. That was at the end of 2003, toward the end of
2003. It may have been in August. Is that right, sir?
Mr. Prince. I believe it happened right after the U.N.
facility in Baghdad was blown up by a large truck bomb. Yes,
sir, they then feared for the U.S. officials.
Mr. Kucinich. Now that contract was no-bid, is that right,
sir?
Mr. Prince. It was off the GSA schedule.
Mr. Kucinich. Can you tell us how you got this no-bid
contract?
Mr. Prince. Off the GSA schedule is considered a bid
contract, sir. The GSA schedule is a pre-bid program kind of
like catalogue of services that you put out, like buying
something from the Sears catalog.
Mr. Kucinich. Did you talk to anyone in the White House
about the contract?
Mr. Prince. No, sir.
Mr. Kucinich. Did you talk to anyone in the Congress about
the contract?
Mr. Prince. No, sir.
Mr. Kucinich. Did anyone, to your knowledge, connected with
Blackwater talk to anyone in either the White House or the
Congress about the contract?
Mr. Prince. Not to my knowledge, no.
Mr. Kucinich. Did anyone in the DeVos Family talk to anyone
in the White House or the Congress about the contract?
Mr. Prince. No.
Mr. Kucinich. As a taxpayer, do you think it is proper that
no other companies were allowed to bid?
Mr. Prince. That, I am not aware of, sir. It is a
requirement, Government officials had. They came to us, asked
if it could be fulfilled. I don't know what other companies
they went to as well. I am not aware of that.
Mr. Kucinich. In 2004, the State Department awarded
Blackwater a $332 million task order under its diplomatic
protection contract. Are you familiar with that?
Mr. Prince. I am familiar about the amount. I know that we
transitioned over to working for the State Department from the
CPA. I am not sure exactly when that happened.
Mr. Kucinich. Thank you, sir.
According to the Federal Contracting Data base, you didn't
have to compete for that one either, is that correct?
Mr. Prince. Again, I believe they continued that off the
GSA schedule which is an approved contracting pre-bid method.
Mr. Kucinich. Who at the State Department were you dealing
with in order to get this contract?
Mr. Prince. I don't know. I presume it was under the
diplomat.
Mr. Kucinich. Excuse me?
Mr. Prince. It was under the Diplomatic Security Service.
That is the folks at State we were working for.
Mr. Kucinich. Now SIGIR reported that this was a no-bid
contract. Was SIGIR incorrect? It was a no-bid contract or not?
Mr. Prince. I am not sure how they are defining bid or no-
bid. In my understanding, they used, we used pricing off the
GSA schedule, and I believe that is considered, regarded as a
biddable contract.
Chairman Waxman. Will the gentleman yield to me?
Mr. Kucinich. I yield to the Chair.
Chairman Waxman. It is on the GSA schedule. Did they come
to you to put your offer of services on the GSA schedule? Did
you go to them? How did that get on the GSA schedule?
Mr. Prince. Oh, most companies in our kind of work have a
GSA schedule. We have a GSA schedule for target systems. We
have a GSA schedule for----
Chairman Waxman. So you offered services and you are on the
list of services that they can purchase?
Mr. Prince. Yes, sir.
Chairman Waxman. You don't know if anybody was on the list
for these kinds of services?
Mr. Prince. Oh, I am sure there are lots of companies that
are.
Chairman Waxman. For some of the services.
Did you go to anyone else or did anyone else from the
Government go to you to ask you to do the work?
Mr. Prince. I don't know, sir.
Chairman Waxman. Did they ask you to see if you could put
together this operation and then they put you on the schedule?
Mr. Prince. I would say we were present in the country
already. We already had significant presence with the CPA under
a bid contract. I believe that contract was called Security
Services Iraq. So we had a large presence of static guards and
PSD kind of work for them.
So I think they probably just wanted to transition from DOD
work to Department of State work.
Chairman Waxman. Thank you.
Mr. Shays.
Mr. Shays. Thank you, Mr. Chairman.
Mr. Chairman, I didn't make an opening statement. I was
chairman of the National Security Subcommittee and ranking
member, and so I have a keen interest in this issue, but other
Members had important statements to make. So, first, I would
like to make an observation.
I want to align myself with the statement of Tom Davis, my
ranking member now. I thought it adequately and perfectly
expresses my view.
I want to thank both the chairman and Mr. Davis for
honoring U.S. Department of Justice's request not to discuss an
incident we don't have enough facts to discuss, and we will
deal with that later. I think that is responsible.
I think this hearing, the way we are dealing with it, is a
very important effort, given what we are doing.
Now, saying that, during the Vietnam War, I was a
conscientious objector. I was a Peace Corps volunteer, so I try
to be very careful when I evaluate the performance of men and
women under fire. Frankly, many of those behind you at this
desk are exactly that. We are behind a desk, never been shot
at, never tried to understand what it is like to be under fire.
Blackwater, I want to say, has a reputation of being a bit
of a cowboy, but I know we absolutely need protective security
contractors. The role of security contractors is much different
than the role of the military.
But I also want to say that I feel that the State
Department could do a better job of enforcing and holding
contractors accountable, and I think they are going to make a
point that they are willing to have this reviewed by an outside
party and then have us look at it.
Now, saying that, I also want to say the number of times
that you all have to protect Members of Congress is
infinitesimal compared to all the civilians you have to
protect.
One of the outrages, in my judgment, is that there haven't
been more Members who have gone there and, frankly, that some
Members who have never been there are passing judgment on what
we are doing there. They are behind a desk with no sense of
what is happening there.
I am in awe of what your men and women and they have been
mostly men, have done to protect our civilians. I am absolutely
in awe of it. You know you can't be perfect, but in one way you
have been perfect if this is true.
Tell me, from June 2004 to the end of that year, how many
missions you protected or let me say it this way, if you don't
know how many missions you protected, how many people you
protected were wounded or killed in 2004?
Mr. Prince. No, sir, we have never had anyone seriously
injured.
Mr. Shays. I am going to do year by year. Did you have
anyone wounded or killed in 2004?
Mr. Prince. No, sir.
Mr. Shays. Did you have anybody wounded or killed in 2005?
Mr. Prince. No, sir.
Mr. Shays. These are the people you are trying to protect.
Mr. Prince. I mean wounded, yeah. A big IED ruptured an
eardrum. That is the most serious level there.
Mr. Shays. Did you have anyone wounded or killed in 2006?
Mr. Prince. People that we were protecting?
Mr. Shays. Yes.
Mr. Prince. No.
Mr. Shays. Did you have anyone who was wounded or killed in
2007 that you were to protect?
Mr. Prince. No, sir.
Mr. Shays. That is a perfect record, and you don't get any
credit for it for some reason.
Now, were any of your people killed in 2004, trying to
protect the civilians?
Mr. Prince. Yes, sir.
Mr. Shays. Were any of your people killed in 2005, trying
to protect civilians?
Mr. Prince. Yes, sir.
Mr. Shays. Were any of your people killed in 2006, trying
to protect civilians?
Mr. Prince. Yes, sir.
Mr. Shays. Were any of your people killed by trying to
protect the civilians in 2007?
Mr. Prince. Yes, sir.
Mr. Shays. Every year, you have had men who have risked
their lives and who have been killed, fulfilling their mission,
and they have succeeded 100 percent, and I just want to be on
record as thanking you for an amazing job that you do.
I have been to Iraq 18 times. I have been outside the
umbrella four times. It is one dangerous place. I have seen
films where vehicles come up to our troops or to our security
people, and they are blown up in it.
You have done an amazing task, and there is a huge
difference from being a police officer or protective and being
the military, a totally different role.
I have had no one in the military say to me, I want to
guard all these civilians. The last thing you want is to have
humvees and Army take civilians who are meeting other civilians
like our State Department with that kind of precedent, and the
military would not do it. They are not going to be in a
Suburban. They are going to be in what their protocol requires.
The protocol is totally different. We need security people
who do their job.
Thank you for doing a perfect job in protecting the people
you are required to protect.
I yield back.
Mr. Prince. Thank you, sir. It is an honor to do the work.
Chairman Waxman. The gentleman's time has expired.
Before I recognize Mr. Davis, I want to put in the record,
a statement from the Special Inspector General in Iraq from
July 2004, that indicates that the security guards and two
helicopters for Bremer, sole source directed; the security for
inner ring Republican Presidential compound, Al Rashid Hotel,
sole source; the security for Al-Rashid Hotel, sole source to
Blackwater.
Mr. Shays. I reserve my right to object. Would the
gentleman say was that under Bremer or after Bremer?
Chairman Waxman. This is in 2004. It would have been
Bremer.
Mr. Shays. So it was under Bremer, not since we transferred
power to the Iraqis.
Chairman Waxman. I don't know the answer to that. This
document only refers to the period of time.
Mr. Shays. Under Mr. Bremer. I don't object.
[The information referred to follows:]
[GRAPHIC] [TIFF OMITTED] T5219.036
Mr. Ryan. Mr. Chairman, may I have minute, please? May I
have a minute, please? One minute, please?
Chairman Waxman. Yes.
Mr. Prince. Thank you, sir.
Chairman Waxman. Thank you.
Mr. Davis.
Mr. Davis of Illinois. Thank you, Mr. Chairman.
Mr. Prince, throughout your testimony and in other comments
attributed to you, you have praised the Blackwater personnel on
the ground in Iraq, but mistakes do, in fact, happen. You do
admit that Blackwater personnel have shot and killed innocent
civilians, don't you?
Mr. Prince. No, sir. I disagree with that.
I think there have been times when guys are using defensive
force to protect themselves, to protect the package they are
trying to get away from danger. There could be ricochets. There
are traffic accidents. Yes. This is war.
You know since 2005, we have conducted in excess of 16,000
missions in Iraq and 195 incidences with weapons discharged. In
that time, did a ricochet hurt or kill an innocent person? That
is entirely possible.
Again, we do not have the luxury of staying behind to do
that terrorist crime scene investigation to figure out what
happened.
Mr. Davis of Illinois. Well, according to a document we
obtained from the State Department on June 25, 2005, Blackwater
guards shot and killed an innocent man who was standing by the
side of the street. His death left six children alone with no
one to provide them support.
Are you familiar with this incident?
Mr. Prince. I am somewhat familiar with that incident.
I believe what happened, it was a car bomb or a potential
car bomb had rapidly approached our convoy. I believe our guys
shot rounds at the car, not at the driver, to warn them off.
One of those rounds, as I understand, penetrated through the
far side of the car, ricocheted and injured that innocent or
killed that innocent man.
Mr. Davis of Illinois. Well, again, according to the State
Department document, this was a case, ``involving the PSD
personnel who failed to report the shooting, covered it up and
subsequently were removed from Al-Hillah.''
The State Department described the death as ``the random
death of an innocent Iraqi.''
Do you know why Blackwater officials failed to report this
shooting and later tried to cover it up?
Mr. Prince. I can clarify that fully, sir. Thanks for
asking that question.
There was no cover-up because our people reported it to the
State Department. They did look into the shooting and the
justification of it, and it was deemed to be an appropriate use
of force. The man was fired because he had tried to cover it
up. He panicked and had asked the other team members to cover
it up and to not report it.
We discovered that through our, I mean our policy worked.
We reported the incident to the State Department, and that is
why you folks have it in the committee because we fired the
guy. He was terminated not for an inappropriate shooting but
for not following the reporting procedure.
Mr. Davis of Illinois. Well, was there any reason this
report was not provided to the committee?
Mr. Prince. I don't know, sir. I will have to. I will look
into that and get back to you.
Mr. Davis of Illinois. Well, the same document states that
the State Department contacted Blackwater headquarters to
encourage you to offer this man's family, compensation. After
this shooting of an innocent man and after the attempted cover-
up, Blackwater paid $5,000 to the family.
Is that not correct?
Mr. Prince. I believe that was paid through the State
Department. That is similar to what DOD does, what the Army
does if there is an accidental death from whether it is an
aerial bomb, a tank backs over somebody's car or injures
someone. There is compensation paid to try to make amends, but
that was done through the State Department.
That was not paid to try to hush it up or cover it up. That
is part of the regular course of action. There was no cover-up
because our guys reported the incident, and the company fired
him for not reporting the incident.
Mr. Davis of Illinois. Can you tell me how it was
determined that this man's life was worth $5,000?
Mr. Prince. We don't determine that value, sir. That is
kind of an Iraqi-wide policy. We don't make that one.
Mr. Davis of Illinois. Do you know how many payments
Blackwater has made to compensate innocent Iraqis or their
families for deaths or injuries caused by Blackwater personnel?
Mr. Prince. I do not know that, sir.
Mr. Davis of Illinois. Do you know what the total value of
those payments might be?
Mr. Prince. No, sir.
Mr. Davis of Illinois. Could you supply the committee with
that information?
Mr. Prince. Yes, sir. I will make sure we get it back to
you.
Mr. Davis of Illinois. Thank you very much.
Mr. Chairman, what I am concerned about is the lack of
accountability. If one of our soldiers shoots an innocent
Iraqi, he or she can face a military court martial. But when a
Blackwater guard does this, the State Department helps arrange
a payout to make the problem go away. This seems to be a double
standard, and it is causing all kinds of problems in Iraq.
Chairman Waxman. The gentleman's time has expired.
Mr. Platts.
Mr. Platts. Thank you, Mr. Chairman. I appreciate your
holding this hearing.
Mr. Prince, I appreciate your testimony and want to thank
you personally for your 5 years of service to our Nation as a
Navy SEAL and also, having been to Iraq five times, for the
dedication of your colleagues for delegations I have been part
of and certainly many others as well. We are grateful for their
courageous service.
Your contract, and it has been discussed already, is under
the Worldwide Personal Protective Services Contract. My
understanding is under that contract, there are specific terms
of conduct including rules of engagement with the use of force.
Is that correct?
Mr. Prince. Yes, sir, that is correct.
Mr. Platts. You testified about, as an example of the
seriousness with which your company takes the conduct of your
employees, of 122 individuals that have been fired for
misconduct. Are you able to give us what number of those were
related to violations regarding use of force rules of
engagement, specifically?
Mr. Prince. I believe the committee report listed it. Don't
quote me on it. I think it says in the committee report around
10 or 15. I am not sure. It is in the committee report.
Mr. Platts. You accept that information as accurate?
Mr. Prince. That is a weapons violation. That could mean a
dirty gun or possession of some unauthorized firearm. We have
very clear rules. We are only issued. The Government issues us
our weapons, even down to scopes. We are specified as to which
optical device we can put on the weapon. Some guys get fired
because they put, they like an aimpoint instead of an ACOG.
Mr. Platts. Of those 10 to 15, they may not all be related
to use of force, misuse of force.
Mr. Prince. Yes, sir, correct.
Mr. Platts. A number of times you were asked about in
addition to firing and fining and removing the person from your
employment and from Iraq, about what criminal actions you took,
and you appropriately stated you are not a law enforcement
entity. You are a private company.
That being said, though, is it accurate to say that where
there is a criminal investigation by the Department of Justice
of Department of State pursuing, that you provide any
information that your company has about misconduct?
Mr. Prince. Yes, we fully cooperate in the Christmas Eve
incident and any other ones that State Department or Justice
Department wants to look at.
Mr. Platts. Thank you, Mr. Chairman. That is all of my
questions.
Again, my thanks to Mr. Prince and his colleagues for their
service.
Chairman Waxman. Would the gentleman yield some of his time
to me?
Mr. Platts. Yes, Mr. Chairman.
Chairman Waxman. Thank you.
The point I want to ask you, Mr. Prince, is we appreciate
what you have done, but it looks like a lot of people in the
U.S. military don't appreciate it. One man, an Army colonel,
Teddy Spain, said, ``I personally was concerned about any of
the civilians running around on the battlefield during my time
there. My main concern is with their lack of accountability
when things went wrong.''
Another senior U.S. military official said, ``We had guys
who saw the aftermath,'' meaning the aftermath of your
activities there. ``It was very bad. This is going to hurt us
badly.''
Then we had Secretary of Defense Robert Gates: ``These
incidents may be uncommon. We don't know how common they are,
but let's assume that they are uncommon. I believe that they
still have disproportionate impact on the Iraqi people. We have
people who are conducting themselves in a way that makes them
an asset in this war, not a liability.''
You are not answerable to the U.S. military, are you?
You report to the State Department? You are under contract
with State, isn't that right?
Mr. Prince. In Iraq, we report to the State Department, but
if I could just add.
Chairman Waxman. So your people are under the same rules as
the U.S. military.
Mr. Prince. We operate under defensive rules of engagement.
Mr. Davis of Virginia. Will the gentleman yield?
Mr. Platts. Actually, Mr. Chairman, if I could reclaim my
time in responding.
Mr. Prince, you provided the committee a detailed list of
the regulations, treaties, laws that you operate under, is that
correct?
Mr. Prince. Yes, sir.
Mr. Platts. That includes items that relate to both
Department of State and Department of Defense?
Mr. Prince. It includes laws like MEJA, the UCMJ, all of
which we can be held accountable. Our people can be held
accountable for while operating overseas.
Let me just ask, answer, Mr. Chairman, about whether we are
adding value to the military or not.
I have to say my proudest professional moment was about a
year and a half ago. I spoke at the National War College. After
my speech, a colonel, a full bird colonel, came up to me
afterwards. He said, I just came back from brigade command in
Baghdad, and he had 4,000 or 5,000 guys working for him.
He said, as his guys were driving around the city, on the
top of their dashboards of their humvees were the Blackwater
call signs and the frequencies because his soldiers knew that
if they got in trouble, the Blackwater guys would come for
them. They would come to their aid and assist them, med evac
them and help them out of a tough spot.
So if that is the reputation we have, I----
Chairman Waxman. The Brigadier General Karl Horst said,
``These guys run loose in this country and do stupid stuff.''
Mr. Platts. Mr. Chairman.
Chairman Waxman. ``There is no authority over them, so you
can't come down on them when they escalate force.''
Mr. Platts. Mr. Chairman.
Chairman Waxman. ``They shoot people, and someone else has
to deal with the aftermath. It happens all over the place.''
Security contractors in Iraq are under scrutiny after
shootings.
What do you say?
Mr. Prince. Sir, I can also tell you there is 170-some
security companies operating through Iraq. We get painted with
a very broad brush of a lot of the stuff they do.
On almost weekly basis, we get a contact from someone in
DOD, some talk somewhere that says, oh, three Blackwater guys
were just taken hostage here. Four guys were killed there. Oh,
you were involved in a shooting over here.
When we fully investigate, we didn't have any teams of guys
within 100 miles of that location, but if a private security
contractor did it, it often gets attributed to us.
Chairman Waxman. Regardless of what private security
contractor does it, it is a problem for the United States.
Mr. Platts, you were kind enough to yield me time. Without
objection, I would like to give to you another 30 seconds.
Mr. Platts. If you could, I was going to yield to the
ranking member. Thank you, Mr. Chairman.
Mr. Davis of Virginia. I appreciate your questions, but let
me just say, Mr. Chairman, for the sake of argument, you are
right. If we are paying too much and getting too little, what
is the answer? More troops in Iraq? Less safe troops? Less safe
diplomats or less safe Members?
I mean this is the tradeoff. This is what we are trying to
explore here. They are contractors.
At the end of the day, we have to look to the Government
who is contracting this out, putting down the rules of
engagement, and they will be on our next panel. He is just
performing his contract at this point, and I think we have
questions that we can ask the State Department.
But the alternatives, none of them are attractive when you
are in a war zone.
Chairman Waxman. The gentleman's time has expired.
Mr. Tierney.
Mr. Tierney. Thank you, Mr. Chairman.
Mr. Ryan. Mr. Chairman, may I have 1 minute, please? We do
not need to leave. One minute, please.
Chairman Waxman. Yes, go ahead.
Mr. Ryan. Thank you.
Chairman Waxman. Without objection, I would like to ask
that Mr. Davis and I, during this moment, have a minute each
because I would like to say something that doesn't involve a
question and you might want to respond to it.
The point I want to make, you raise that very essential
question, what do we do if we don't have enough troops there?
Well, I think we have to look at the fact that this isn't a
short term war. We have been there 5 years. It looks like we
may be there another 10 years. Even General Shinseki said we
need more troops.
At some point, you have to make a decision in this
battlefield, in this war. If we don't have enough troops to do
the job, then we should get more troops. But if we are going to
go on the cheap to get private contractors, we are not on the
cheap at all. It is costing us more money, and I believe it is
costing us problems, causing us problems with the Iraqi people.
Let's let the military replan this. It seems to me we have
had bad decisions from this administration too much of the time
in handling this whole war, planning for it adequately and
staffing it adequately with the U.S. military. They are the
ones that ought to be doing this job.
Mr. Davis.
Mr. Davis of Virginia. Mr. Chairman, I understand, but let
me just say troops that are there are not paid to protect
civilians. That is not what military troops are trained for.
I went through officer basic course in Georgia at Fort
Benning. I went through basic training at Fort Ord. That is not
what troops are trained for when they go out into the battle
zone.
This is a unique responsibility. It is through the State
Department, not the Department of Defense. As we will hear from
the next panel, our troops are not, at this point, being
trained to do this kind of work. This is a different kind of
process.
Now if we want to train them to do that, we can do that,
but that hasn't been the history throughout the last 50 years
of the military that I am aware of. So we then have to decide
from a cost-benefit perspective.
I think this is an important conversation to have, but to
date that is not the contractors' fault. I think our argument
would be with the State Department.
Chairman Waxman. I want to yield to Mr. Tierney, but
Blackwater and the private military recruit from our military.
So these people are trained to the job that Blackwater and
other private military people are asking them to do. So why
can't the military do it?
I think they could do it if we had enough military
personnel.
Mr. Davis of Virginia. Sir, I would like Mr. Prince to
respond, but I am sure they retrain them. They don't just take
raw recruits out. Could I just ask him to respond?
Mr. Prince. Yes, sir. There was an earlier allegation about
companies like us raiding the ranks of the Special Operations
community for this kind of work, and the GAO report found that,
yes, they are getting out and working for companies like us,
but they are not getting out at any higher rate than they ever
did before.
So, they are, instead of becoming a financial analyst or an
accountant or some other kind of businessmen, they come to work
for companies like Blackwater, but they are not getting out at
any rate higher than they ever did before.
If I could just correct two slight errors I made. We did
not have any fatalities of Blackwater personnel in 2006.
One of the contracts I testified to as being under the GSA
schedule was, in fact, sole source. We will get you the very
detailed information as to which contracts were GSA and which
were sole source. I am not qualified to answer that right now.
Chairman Waxman. Thank you. We will receive any documents
you have.
Mr. Davis of Virginia. Mr. Chairman, if I could just have a
minute. I think that one of the things we want to get to in
this and later hearings is if the mission is going to be 4 or 5
or 6 years, do you want to change the mission of the military,
but that is not the contractors' fault. Our argument there is
with the Defense Department and the State Department.
Mr. Prince. I strongly encourage the Congress to sponsor
true activity-based cost studies. What does it cost the Air
Force to move a pound of cargo in a war zone? What does it cost
to put a brigade in the field or train it and to equip it? All
these basic functions, even what is the hourly cost of aircraft
doing refueling?
Chairman Waxman. We are going to have you answer some more
questions, I am sure, along those lines.
Mr. Tierney, it is your turn.
Mr. Tierney. Are you certain, Mr. Chairman?
Thank you.
Mr. Prince, thank you for being here today. We have been
discussing a little bit here about the goal of this particular
venture here. I think that General Petraeus has been pretty
clear that he would like to change it from the type of war it
has been to one where he wants to defeat insurgents, and that
entails, in significant part, winning the hearts and minds.
So I want to read to you this quote: ``Counterinsurgents
that use excessive force to limit short term risk alienate the
local populace. They deprive themselves of support or tolerance
of the people. This situation is what insurgents want. It
increases the threat they pose.''
Do you know who made that statement?
Mr. Prince. Do I know who made that statement?
Mr. Tierney. Yes.
Mr. Prince. No, sir.
Mr. Tierney. That was General Petraeus. You know he was the
one who wrote the official counterinsurgency manual.
It does appear from some of the evidence here, though, that
Blackwater and other companies, sometimes at least, conduct
their missions in ways that lead exactly in the opposite
direction that General Petraeus wants to go, but that doesn't
mean you are not fulfilling your contractual obligations.
In a recent report, there was a quote from Ann Exline Starr
who is a former Coalition Provisional Authority Advisor. She
talks about the fact that the private mission is different from
the overall public operation. ``Those, for example, doing
escort duty are going to be judged by their bosses solely on
whether they get their client from point A to point B, not
whether they win Iraqi hearts and minds along the way.''
She goes on to talk about the fact that soldiers, when they
escorted her because they are able to escort people in training
for that, often times also interacted with the Iraqi community
and did things to ingratiate themselves to the Iraqis.
The contractors, by contrast, focused only on the contract.
She said what they told her was our mission is to protect the
principal at all cost. If that means pissing off the Iraqis,
too bad, her language, not mine.
Another counterinsurgency expert is Army Colonel Peter
Mansoor. Earlier this year, he made a statement about private
military contractors, and he said, ``If they push traffic off
the roads or if they shoot up a car that looks suspicious, they
may be operating within their contract, but it is to the
detriment of the mission which is to bring people over to our
side.''
So when we look at Blackwater's own records that show that
you regularly move traffic off the roads and you shoot up cars
in over 160 incidents of firing on suspicious cars, we can see,
I think, why the tactics you use in carrying out your contract
might mitigate against what we are trying to do in the
insurgency.
Retired Army officer, actually, he is a conservative
analyst now, Ralph Peters. He was more blunt about it. He said,
``Armed contractors do harm COIN, counterinsurgency efforts.
Just ask the troops in Iraq.''
We have had complaints from military leaders over and over
again that the ways that some contractors operate in Iraq are
causing danger and anger against the U.S. forces. Let me give
you one example. For most of 2005, the Army's Third Infantry
Division was in charge of security in Baghdad.
Here is what the deputy commander of this division,
Brigadier General Karl Horst, said about Blackwater and other
private military contractors: ``These guys run loose in this
country and do stupid stuff. There is no authority over them,
so you can't come down on them when they escalate force. They
shoot people, and someone else has to deal with the aftermath.
It happens all over the place.''
Are you familiar with General Horst, sir?
Mr. Prince. No, sir. I have never met him.
Mr. Tierney. Well, here is what Colonel Hammes said when he
was an officer in Iraq. He said, ``The problem is in protecting
the principal, they had to be very aggressive and each time
they went out, they had to offend locals, forcing them to the
side of the road, being overpowering and intimidating, at times
running vehicles off the road, making enemies each time they
went out.''
So they were actually getting our contract exactly as we
asked them to, at the same time hurting our counterinsurgency
effort.
This goes on again back to Colonel Peter Mansoor who said,
``I would much rather see basically all armed entities in a
counterinsurgency operation fall under the military chain of
command.''
The CENTCOM Commander, Admiral James Fallon, who we all
know now for his current work, his quote is: ``My instinct is
that it is easier and better if they were in uniform and
working for me.''
Can you see and appreciate, Mr. Prince, why there might be
some contradiction between what we are asking your organization
and others like it to do under the contract as opposed to what
we are trying to do as a military force in counterinsurgency?
Mr. Prince. Sir, I understand the challenges that the
military faces there.
Like I said before, there is 170 some companies doing
business in Iraq. Most of those security contractors are DOD. I
think the DOD officers would even complain about their lack of
reach over their own DOD Corps of Engineers, MNSTC-I type
contractors.
Second, we know we are part of the total force in trying to
get the mission accomplished. Of the 16,000 missions our guys
have done, only 195 resulted in any kind of discharge of a
weapon. That is less than 1 percent. So we strive for
perfection, but we don't get to choose when the bad guys attack
us.
You know the bad guys have figured out. The terrorists have
figured out how to make a precision weapon with a car loaded
with explosives with a suicidal driver.
Mr. Tierney. Just to interrupt you for a second, you are
not asserting that every time that you take affirmative action
it was somebody firing at you first. You do acknowledge that,
on some occasions at least, it was a preventive act on your
part of your people.
Mr. Prince. Yes, sir, but this is what happens when our
guys are not able to prevent a suicide car bomb. This happened.
This blew up three Blackwater personnel and one State
Department security officer up in Mosul.
It tossed a 9,000 pound armored Suburban 50 feet into the
side of a building, followed by a whole bunch of small arms
fire from the rooftops, a very serious ambush, killed four
Americans that fast.
Mr. Tierney. My question was that you are not disputing the
fact that on some occasions when your people might be afraid
that something like that is going to happen, that they may fire
first, ask questions later.
Mr. Prince. Sir, like I said the bad guys have made a
precision weapon. The Air Force has a system called a DIRCM,
Directional Infrared Countermeasures. It is used to break the
lock of an incoming surface to air missile. It shines a laser
in the seeker head. The missile breaks lock, and it veers away.
We have to go through a use of force continuum to try to
break the lock of this potential deadly suicide weapon: hand
and arm signals, sirens, signs at the back of the vehicles,
water bottles, pen flares, shots to the radiator, shots to the
windshield before we even go to a lethal force option.
So our guys do go through it, but they----
Mr. Tierney. Well, some of the evidence indicates that----
Chairman Waxman. The gentleman's time has expired.
Mr. Tierney. Mr. Waxman, I would like to just finish up my
thought if I might. I think there has been fairly good
estimation on the part of the committee here.
Chairman Waxman. If you can do it in seconds rather than
minutes.
Mr. Tierney. Thank you.
The point being made is that there are instances--you are
not denying--when people shoot first on that.
When you multiply that by the number of times it happens
and the number of people and Iraqis, that are implicated in
those situations, the number of people that they tell, it goes
against our counterinsurgency effort and it goes to the issue
of whether or not we ought to have military personnel doing the
job, whether this is an inherently Government function that we
ought to have done on the public side of it as opposed to
having contractors who, by what we are seeing here today,
really don't have much accountability being exercised over them
by either the State Department or the Department of Defense.
I yield back, Mr. Chairman.
Chairman Waxman. The gentleman yields back the rest of his
time.
The Chair now recognizes Mr. Duncan.
Mr. Duncan. Thank you, Mr. Chairman.
Mr. Burton. Excuse me, Mr. Chairman.
Mr. Prince, did you want to respond to what was said?
Chairman Waxman. That wasn't a question. That was a
statement by the Member.
Mr. Burton. Well, I know, but when an allegation.
Chairman Waxman. Mr. Duncan is recognized.
Mr. Burton. Mr. Chairman, when an allegation is made.
Chairman Waxman. Mr. Duncan is recognized. You are using
his time.
Mr. Prince. I will get it, Mr. Burton. It is all right.
Mr. Duncan. Thank you, Mr. Chairman.
The Washington Post reported yesterday. It said Army
General David H. Petraeus, the top U.S. Commander in Baghdad,
overseeing more than 160,000 troops, makes roughly $180,000 a
year or some $493 a day. That comes out to less than half the
fee charged by Blackwater for its senior manager of a 34-man
security team.
Our committee memorandum says using Blackwater instead of
U.S. troops to protect embassy officials is expensive. That is
putting it lightly. Blackwater charges the Government $1,222
per day for the services of a private military contractor. This
is equivalent to $445,000 per year, over six times more than
the cost of an equivalent U.S. soldier.
This war has produced some of the most lavish, most
fiscally excessive and most exorbitantly profitable contracts
in the history of the world. It seems to me that fiscal
conservatives should feel no obligation to defend this type of
contracting. In fact, it seems to me that fiscal conservatives
should be the ones most horrified by this.
I notice in the table that Blackwater's contracting has
gone from $25 million in 2003, $48 million in 2004, to $593
million in 2006. If we are going to be there another 10 years,
as some have said, I surely hope that we are not going to
continue to see these types of ridiculously excessive increases
in the contracts that are being handed out.
I also notice that Blackwater is a subsidiary of the Prince
Group, of Prince Group Holdings and that another one of the
holdings of that firm is Presidential Airways, an aviation
company that has held a contract with the U.S. Air Force Air
Mobility Command.
Mr. Prince, can you tell me what percentage of Prince Group
Holdings comes from Federal contracts of all or any types?
Mr. Prince. Could you say the question again, sir? I didn't
quite hear you.
Mr. Duncan. Can you tell me? I don't know all the companies
that are in your Prince Group Holdings. Apparently, there is a
Presidential Airways. I don't know how many other companies
there are.
What I am wondering about is how much of Prince Group
Holdings comes from Federal contracts of any and all types?
Mr. Prince. Most of Prince Group Holdings comes from
Federal contracts, but if I could just come back and answer
your statement about prices that we charge, that $1,222.
Mr. Duncan. When you say most, does that mean 100 percent?
Mr. Prince. No.
Mr. Duncan. Rough guess, what percentage?
Mr. Prince. Rough guess, 90 percent.
Mr. Duncan. Do you still have a contract with Presidential
Airways with Air Force Mobility Command?
Mr. Prince. Yes, sir.
Mr. Duncan. Rough guess, how much is that contract each
year?
Mr. Prince. I don't know what the exact number is, sir. It
is for eight aircraft right now. I don't know what they price
out at.
Mr. Duncan. What other companies are in Prince Group
Holdings?
Mr. Prince. There is a long list. I have a manufacturing
business that has nothing to do with Federal stuff, and we make
pieces and parts for automotive, appliance, industrial, power.
We compete with the likes of the Japanese and Koreans and
European companies every day.
Mr. Duncan. All right.
Mr. Prince. But if I could just answer the question about
how much we charge, those are competitively bid prices. The
$1,222 cited in the report is not accurate.
You also, the committee should have received this. I don't
know if you have seen that. It lays out base year bill rates
for an average security guy. Base year is $981, not $1,222, and
our profit on that, projected to be 10.4 percent, nothing
higher.
And on top of that, I can tell you we have three
helicopters that have been shot down this year, a Little Bird
and two Bell 412s. Those are company helicopters, and when they
go down that comes out of our hide. We have to self-insure on
those.
So the risks we take, the financial risks, whenever an
aircraft is doing a mission for the State Department or
responding to some med evac need, above and beyond the
statement of our contract, trying to pull a U.S. soldier out of
bad, wounded situation, we take that risk as a company, and our
guys do themselves at great personal peril.
So it is not just about the money. We are a business. We
try to be efficient and excellent and deliver a good service.
We are happy to have that argument, sir, not the argument,
the discussion. Sponsor an activity-based cost study. What
would it cost the Diplomatic Security Service to bring all
those folks in house as staff?
Look at it. We are happy to have that argument. If the
Government doesn't want us to do this, we will go do something
else, but there is plenty of case to be made and plenty of
spreadsheets to be analyzed.
Chairman Waxman. The gentleman's time has expired.
The Chair now recognizes Mr. Clay.
Mr. Clay. Thank you, Mr. Chairman.
Mr. Prince, I am truly disturbed by reports of Blackwater
contractors wreaking havoc on innocent Iraqi citizens. I am
equally troubled that taxpayers have been taken for a ride by
paying six times the cost of a U.S. soldier for Blackwater
contractors.
Now, Mr. Prince, you have argued that Blackwater provides a
cost-effective service to the U.S. Government in part because
by hiring private contractors the Government can avoid paying
carrying costs such as training, salaries and benefits.
Yet, in your written testimony, you state that Blackwater
personnel are all military veterans and law enforcement
veterans, many of whom had recent military deployments. Since
so many of your employees have recently left Government
service, doesn't that mean they have received years of
specialized training at the expense of the Federal Government?
Mr. Prince. People serve the U.S. Government for different
periods of time, and that is a choice they make and have been
making since the United States has had a standing military.
They serve for 4 years. They serve for six. They serve for 20
or 30.
Mr. Clay. So the U.S. taxpayers are paying for that
training.
Mr. Prince. They are paying for that anyway. We provide a
vehicle, a mechanism for the U.S. Government to utilize that
sunk cost that they have put into the training for these
people. We reorganize it and package in a way to fill these
gaps that the U.S. Government has in these kinds of contingency
operations.
To stand up a 1,000-man or actually you need a 3,000-man,
at least, military police brigade to do this kind of work
because for every person that is deployed, they are going to
have two more back stateside, one in training and one in
standdown.
So you spin that meter, and the costs get big very quickly.
So we are just reorganizing those skills that the Government
has already paid for and putting them back to work.
Mr. Clay. Last week, Defense Secretary Robert Gates
expressed concern that Blackwater and other private military
contractors are actually poaching the military's ranks, luring
service members away with much higher salaries.
When Secretary Gates testified before the Senate
Appropriations Committee, he said he asked Pentagon officials
to work on drafting non-compete clauses in order to put some
limits on the ability of these contractors to lure highly
trained soldiers out of our forces to go and work for them.
How do you feel about non-compete clauses, Mr. Prince?
Mr. Prince. I think that would be fine, but the fact is
everyone that joins the military doesn't necessarily serve 20
years. So, at some point, they are going to get out after four,
six, eight, whatever that period of time is, whatever they
decide because we don't have a draft. We have a voluntary
service.
I think it would be upsetting to a lot of soldiers if they
didn't have the ability to go use the skills that they have
accumulated in the military to go work in the private sector
because you could make the same case about aviation mechanics,
jet engine mechanics, guys that work on a reactor on a
submarine. All those skills have direct correlation to the
private sector. I don't think putting in non-competes for them
would do well to draw guys into the military in the front side
either.
Again, the GAO study found that the Special Operations
community, yes, folks are getting out and they go to MBA
school. They become some other private sector job. Yes, a lot
of them come to work for companies like us but not at any
higher rate than they ever did before.
Mr. Clay. Well, I mean if the Pentagon adopts the non-
compete clause, it certainly indicates to me that the Secretary
is really concerned about you all poaching on our service
personnel, and that is what it indicates to me.
Let me also say to the viewers of C-SPAN today. This
Congress, some in this Congress and the administration seem to
be steeped in hypocrisy as far as taking these frequent flies
to the Green Zone in Baghdad. When you look, they are some of
the same ones who would never lift a rifle to defend this
country in Vietnam but yet ridicule and criticize those who
have not traveled to Baghdad.
I just want the American public to be aware that some in
here are steeped in hypocrisy.
I yield back my time, Mr. Chairman.
Chairman Waxman. The gentleman's time has concluded.
The gentleman from Idaho, Mr. Simpson.
Mr. Turner. Thank you, Mr. Chairman.
I come from Ohio, and Ohio is known frequently as the
Heartland, and in the Heartland there are a few things that are
easy that are not so easy in Washington, DC. Even in Hollywood,
some of these things are easy, and those are the issues of who
is on our team and who is on their team.
Today, I am a little saddened by this hearing because I am
absolutely a supporter of congressional oversight and believe
this committee has incredible functions that we have to do. Our
witness today even talked about being a contractor, the
questions that we should be asking of reliability,
accountability, cost. A lot of the information we have before
us is about dollars, rules of engagement and the like.
But what unfortunately dissolves into our team versus their
team, by any account, by Hollywood's account, by the
performance account, Blackwater is our team. They are our team
working in the trenches and in a war zone.
I haven't heard many questions on this committee about the
rules of engagement or the limits on the work of Al-Qaeda or
the insurgents. In fact, I don't recall one hearing in this
committee where there has been indignation or troubling
responses as a result of the senseless and heartless killings
of Al-Qaeda and the insurgents, but I hear today huge concerns
over what we must exert as oversight on Blackwater. I think it
crosses the line between our team and their team.
Blackwater has questions to answer, and I believe that they
are prepared to do that and today have come forward to do those
things, but we should not go to the extent of undermining
Blackwater's ability to perform as our team.
The Washington Post today, in its editorial in reviewing
how this issue has come to light, stated, ``Congressional
Democrats despise the firm because it symbolizes the private
contracting of military missions that many oppose in
principle.''
This is the Washington Post saying that the congressional
Democrats are despising this firm because of its engagement in
military missions that they oppose.
The Washington Post goes on to say, ``At the same time, it
is foolish''--that is a pretty strong word for the Washington
Post.
``At the same time, it is foolish to propose the
elimination of private security firms in Iraq and Afghanistan,
at least in the short term.''
I would hope as we continue our important functions of
oversight that we don't undermine our team.
Now, Mr. Chairman, you made a comment that I have to
respond to in your opening statement. It is written in your
opening statement, and it says, ``As a general rule, children
from wealthy and politically connected families no longer serve
in the military.''
Mr. Chairman, that is an attack on our team. I can tell you
that Duncan Hunter, former chairman of the Armed Services
Committee, currently ranking member, whose son served in Iraq,
would disagree with you. Joe Wilson with the Armed Services
Committee, whose son served, would disagree with you.
I can tell you that the DOD in its report on social
representation in the U.S. military services and the GAO in
their September 22, 2005 report would disagree with you.
Quoting from the DOD report, it says, ``Our Population
Representation Report shows both a diversity and quality of the
total force. Men and women of various racial and ethnic groups,
of divergent backgrounds, from every State in our country serve
as active and selective reserve, enlisted members and officers
of the Army, Navy and Marine Corps and Air Force and Coast
Guard.
``One particular note, the mean cognitive ability and
educational levels of these Soldiers, Sailors, Marines, Airmen
and Coast Guardsmen are above the average of comparatively aged
U.S. citizens.''
The GAO, in their report, similarly confirms that between
1974 and 2000, the force became older and better educated.
So I would hope that the comments by the chairman are not
interpreted as what I heard them as, as diminishing the
abilities and the backgrounds of those who serve in our
military.
Mr. Prince, my question for you, you are free of some of
the limiting acquisition rules that our military is subject to.
A general has a different ability to be able to acquire
something as you do corporately.
Could you give us some insight as to how our acquisition
rules inhibit our military in performing some of the things
that you do and ways in which we can change those acquisition
rules to deliver to them the things that they need?
Mr. Prince. Thanks for that question.
I would say we find that the requirements process for the
military constantly looks for the 120 percent solution, and it
overspecs the electronic capability. I mean there is an
enormous amount of extra stuff and capability put on a vehicle
that might not be necessary to just fulfill that job.
I mean if you are going to, you could almost buy vehicles
just planned on for Iraq right now, almost off the shelf,
without having to plan about net-centric warfare and all the
other bells and whistles that sometimes the DOD wants to put on
things. So we buy to solve the situation at hand.
Chairman Waxman. The gentleman's time has expired.
I want to apologize to the gentleman for indicating that he
is from a different State than Ohio. He is a proud Ohioan, and
I certainly want to agree with him. I hope nobody misinterprets
my comments.
I would like to now call on Ms. Watson.
Ms. Watson. Then I want an apology for the reference to
Hollywood. That is the area that I represent here.
I heard the Chair apologize. I just had to tail-in on that
one.
I want to commend Mr. Prince for his duties, for his skill
and for his heading up Blackwater.
However, when I hear that one of the patron saints of some
people, Rush Limbaugh, called our soldiers, who have been
critical of the experience in Iraq, phony soldiers, I am
offended and you should be offended too.
There was a sign over there earlier, Mr. Chair, the General
Petraeus satire, and I had sent a message that it should be
taken down because it was insulting to people.
I think that people that call our soldiers, who speak from
experience, phony, ought to be made to apologize.
Mr. Issa. Would the gentlelady from Hollywood yield for a
question?
Ms. Watson. No, I will not yield because I have just a
little time.
Let me say this. I am really concerned when it comes to
privatizing the various struggles that we are having in a war
zone.
I am looking at a book here that says Blackwater: The Rise
of the World's Most Powerful Mercenary Army. That is really
disturbing to me because I feel that every young man and woman
or every man and woman in the military ought to be paid for
their service, and I think you are making a good argument for
the amount of money that you have been paid, your organization.
I think my question is do you feel that we ought to
continue on with privatizing the kinds of duties that our
military should be trained to execute?
Mr. Prince. Ma'am, the U.S. military is the finest, most
powerful military in the world, bar none.
Ms. Watson. Absolutely, and they should be paid
accordingly.
Mr. Prince. It is designed for large-scale conventional
operations, what they did to Saddam in 1991 and then again in
2003.
Ms. Watson. Well, then there is something wrong with the
design, and that is my point. I think you responded, and I hear
you clearly. You are providing a service, and I commend you.
Let me just continue on.
You are providing a service, and those little voids, Mr.
Chairman and committee members, ought to be filled by the
young, the people who volunteer. We have no draft. These are
volunteers.
Why should they put their lives on the line for this
country and not be compensated, so their families back at home
don't have to go on welfare and are living in housing that is
substandard?
I am just infuriated, not with you, but with the fact that
our State Department and our Department of Defense cannot see
their way. They talk about we don't have the money, saving
money. This war is costing $1 trillion.
You have been paid over $1 billion and will continue to be
paid so that you can buy the helicopters that are shot down.
And so, my question to you, are we going to have to
continue to privatize because we are not training to do what
you do and would it not be better to hire you to train our
military to do the kind of guarding of VIP personnel?
Whenever there is a CODEL, you have to guard them. When
people from the State Department come, you have to guard them
because we say that our military is not prepared and not
trained to do that.
Mr. Prince. Well, ma'am, I am happy to say that we do a
significant amount of training for the U.S. military every day
at our couple of facilities we have around the country.
Ms. Watson. But you are saying that you fill in a specialty
area.
Mr. Prince. It is a specialty gap, high-end personal
security.
Ms. Watson. My question that I throw out to all of us is
why can't we train these people who are willing, who have
courage to go into the military, but then we have to bring on a
private firm to do the job they should be trained to do and pay
them three or four times more than we pay those who choose to
serve their country by fighting in theater?
Mr. Prince. The military could do that, but the U.S.
military can't be all things to all people all the time.
Ms. Watson. Why not?
Chairman Waxman. The gentlelady's time has expired.
Mr. Prince. The tyranny of shortage of time and distance. I
mean you can't have an anti-air missile guy also be doing PSD
missions and knowing how to be an aviation mechanic. It is too
broad of a base of skill requirement.
Ms. Watson. We need more people.
Chairman Waxman. Mr. Issa.
Mr. Issa. Thank you, Mr. Chairman.
Mr. Ryan. Mr. Chairman, may I have 1 minute?
Chairman Waxman. Thank you.
Mr. Issa.
Mr. Issa. Thank you, Mr. Chairman.
Boy, there are so many inaccuracies, so little time.
Perhaps let's start with something from the gentlelady from
Hollywood. Isn't it true that, in fact, the military's mission
has historically not been to guard either VIPs or the State
Department as a whole?
Mr. Prince. Correct, yes, sir.
Mr. Issa. Isn't it true that, in fact, your organization
works under the regional security officer for Baghdad?
Mr. Prince. Yes, sir.
Mr. Issa. Isn't it true that contractors have been used
directly and indirectly, in other words, non-Federal employees
in places Beirut, Afghanistan, Bosnia, under the Clinton
administration, routinely?
Isn't there a historic time in which we used non-career
RSOs or foreign service officers for these jobs?
Mr. Prince. Since the founding of the republic.
Mr. Issa. OK, so, we are not talking about the military
here at all including, with all due respect, to Secretary
Gates. Somebody, if the State Department recruited for the
positions you are presently providing, they would be in all
likelihood recruiting either current or prior military,
wouldn't they?
Mr. Prince. Yes, sir.
Mr. Issa. Is it reasonable for the State Department to own
attack helicopters or Bell helicopters that are weaponized?
Mr. Prince. Well, that is up to them, and our helicopters
aren't weaponized.
Mr. Issa. Let's look at it another way. Outside of the two
theaters, Afghanistan and Iraq, do you know of any place in
which the State Department owns or directly controls weapons,
gunships, if you will, to protect convoys?
Mr. Prince. They do some crop eradication, some cocaine
eradication work in Colombia. That is the only place I know.
Mr. Issa. OK. So this is an unusual mission and one that
begs for not creating a career position for foreign service
helicopter pilot. There would only be about two or three places
they would ever be, isn't that true?
Mr. Prince. Well, actually, those are all flown by
contractors as well, sir, down in Colombia.
Mr. Issa. I am very well aware of that, and that is the
point, I guess. We are having a hearing that is supposed to not
be about your company and supposed to not be about one incident
on September 16th. It is supposed to be about cost
effectiveness of contractors, isn't it?
Mr. Prince. Yes, sir.
Mr. Issa. I wish we were bringing in facts and figures
about let's say $600 billion of DOD contracts or DOD costs into
one million soldiers so that we could go, well, isn't that
about $600,000 for every soldier?
Isn't, in fact, the cost of the Department of Defense, the
military far greater than what we pay our men and women in
uniform at the time that they are in combat?
Mr. Prince. I don't know what those numbers are, sir, but
that would be a great, fully burdened cost study that Congress
could sponsor. They don't have to do the whole thing, just take
some key nodes and really study it.
Mr. Issa. Well, and hopefully, we will. Hopefully, we will
get to serious discussion on these issues because I think
looking at the costs-benefits should always be done. For
permanent requirements, I don't want to use contractors if, in
fact, Federal employees would be more appropriate.
I will mention one thing. If you are feeling a little
pressure today, if it is a little tough, just be glad you don't
make a diabetes drug.
Mr. Prince. To where, sir?
Mr. Issa. Be glad you don't make a diabetes drug. Compared
to what we did to the Avandia makers, GlaxoSmithKline, you are
getting off easy. Trust me. They had their product destroyed by
jury-rigged testimony and studies that were essentially co-
opted in advance.
But let's just go to one area that I think hasn't been
discussed and others might not discuss it. Is your sister's
name, Betsy DeVos?
Mr. Prince. DeVos.
Mr. Issa. Yes. Is that your sister?
Mr. Prince. It is.
Mr. Issa. Was she a former Michigan Republican Party
Chairwoman?
Mr. Prince. Yes, she was.
Mr. Issa. Was she a pioneer for Bush?
Mr. Prince. I don't know. Could be.
Mr. Issa. Was she a large contributor to President Bush?
Mr. Prince. They probably were.
Mr. Issa. And raised a lot of money for President Bush?
Mr. Prince. Could be.
Mr. Issa. Went to the Republican conventions in 2000 and
2004?
Mr. Prince. I would imagine they did, yes.
Mr. Issa. Isn't it true that your family, at least that
part of the family, are very well known Republicans?
Mr. Prince. Yes.
Mr. Issa. Wouldn't it be fair to say that your company is
easily identified as a Republican-leaning company and, in fact,
the Amway Co. somewhat so because of family members there?
You don't have to speculate overly, but isn't that
generally something you understand?
Mr. Prince. Blackwater is not a partisan company. We
haven't done any, you know. We execute the mission given us,
whether it is training Navy Sailors or protecting State
Department personnel.
Yes, I have given individual political contributions. I
have done that since college, and I did it when I was an active
duty member of the Armed Services, and I will probably continue
doing that forward. I don't give that. I didn't give up that
right when I became a defense contractor.
Mr. Issa. Right.
Chairman Waxman. The gentleman's time has expired.
Mr. Issa. Mr. Chairman, just to finish like we did on the
other side of the aisle, I think you are exactly right, that in
fact being identified as partisan Republican, in fact your
company appears to have done what all companies do which is in
fact to operate, to do the job they are doing in a non-partisan
way.
I would hope that this committee and the public take note
that labeling some company as Republican-oriented because of
family members is inappropriate, and I would hope that we not
do it again.
I yield back.
Chairman Waxman. Well, the only one who has done it is you.
[Laughter.]
Mr. Issa. Mr. Chairman, I think it has been made. I think
the report made it very clear.
Chairman Waxman. Maybe that is why all the Republicans are
defending the company.
Well, Mr. Yarmuth, it is your time.
Mr. Yarmuth. Thank you, Mr. Chairman.
Mr. Prince, welcome. Thank you for your testimony.
Mr. Prince. Thank you, sir.
Mr. Yarmuth. I want to focus on the whole issue of cost and
profitability, and I want to clarify something. You talked at
one point about the fact that what you are essentially doing is
bidding for people who would otherwise be able to make as much
money as you would be paying them in the private sector.
First of all, some of that defies imagination because we
are talking about essentially $400,000 to $500,000 worth of
cost per individual per year to the Government which would put
that individual or that job category in the highest 1 percent
of income earners in the country.
So my question to you would be, and this is not in any way
to impugn or to minimize the value of Navy SEALs, but outside
of a military setting, where could a Navy SEAL, for those
talents, make $400,000 to $500,000 if it weren't for a
Government contract?
Mr. Prince. I don't know of any of our people that have
made $400,000 to $500,000 working as a contractor. They are not
getting paid that much.
They get paid for every day they are in the hot zone. So it
is very much like a professional mariner's existence. They go
to sea. They get paid every day they are in the hot zone. They
day they leave, their pay goes to zero.
Average pay, hypothetically, around $500 a day. We don't
pay the $1,000 a day. That is a huge misperception. It is a
flat-out error in the media.
So if you take $15,000 a month and they work for 6 months,
it is $90,000.
Mr. Yarmuth. But that is not the cost of that job to the
American taxpayer.
Mr. Prince. Yes, sir, but they are not showing up at the
job naked. They need uniforms, equipment, body armor, boots,
everything you wear from head to toe, their training, their
travel, their insurance, sometimes their food.
I mean there are very, very sophisticated price models that
we bid competitively for, hundreds and hundreds of line items.
Believe me, our folks earn a lot of electrons putting those
price models together because you really got to know what you
are doing on the front end. But, again, it is a competitively
bid product.
Mr. Yarmuth. Well, I appreciate that, and I want to pursue
that a second, but I do have in front of me an invoice from
Blackwater to the Department of State in which one of the items
is invoice quantity, 3,450 units each at a cost of $1,221.62.
That is your invoice.
Mr. Prince. I am not sure what that invoice is. Could I see
that, sir?
Mr. Yarmuth. I would be happy to submit that for the
record.
We dealt several months ago with a situation in which I
don't believe your company was a subcontractor for the State
Department or a contractor. You were a subcontractor. I am
talking about the incident in Fallujah where four of your
employees were ambushed and killed, and we had testimony from
two of their wives and two of their mothers several months ago.
In the course of that testimony, it was we were told that
they had actually contracted, each of them, at a rate of $600 a
day. That is what they were to be paid. By the time it got to
the American taxpayer, it was around $1,100 a day. You were the
third subcontractor under a contract given to KBR, as I recall,
Halliburton, then a Halliburton subsidiary. And we asked the
question of all of those subcontractors, did anybody add value
up the ladder for that additional $500 based on--and we asked,
did they provide any special equipment, any special services,
whatever. And the answer was no.
So in that case, that is not your profit, but it appeared
to us that by and large that additional $500 that the American
taxpayer paid for that one person was largely profit to three
different corporations. Now, can you shed any light on that
situation? And I don't believe, that was, I think, a Defense
Department contract and KBR was just delivering supplies to
troops and you were guarding the convoys.
Mr. Prince. That could easily be. I am not completely
familiar with the contracting and subcontracting arrangement
that you are speaking of. But I can tell you, with our work
with the State Department, we are direct to the State
Department and there is no other intermediary adding cost or
not adding value.
Mr. Yarmuth. One other question I want to ask. You made the
comparison, again, about that we have to bid for these people.
But isn't there a significant distinction, I understand if we,
the military trains a pilot and then the pilot goes out and is
bid for by commercial aircraft and so forth, that is the
private sector bidding. But in this situation, the American
taxpayers are bidding against themselves. Because we trained
Navy SEALs, Navy SEALs then go into your employ, then the Navy
has to bid, as I understand, in one report, $100,000 to get
them back.
But we are bidding against ourselves, aren't we? We are not
bidding against another external competitor.
Mr. Prince. The nature of the demand of this, especially a
group of Blackwater, even before 9/11, it grew after the Cole
was blown up, that Navy ship. Now, in a post-9/11 world, you
have a lot of different demands for those kinds of skill sets
that are in much higher demand than they were in the late
1990's. So that is the changing nature of the market.
Chairman Waxman. The gentleman's time has expired.
Mr. McHenry. Oh, I am sorry. Mr. Westmoreland.
Mr. Westmoreland. Thank you, Mr. Chairman.
Just to clarify a little bit about who is calling who a
Republican company, I want to read from a December 13, 2006
letter from Callahan and Blaine to Ms. Pelosi, Mr. Waxman,
Senator Dorgan, Senator Reid, Representative Chris Van Hollen:
``Nonetheless, as American citizens, we hereby petition to you
to initiate support and continue the congressional
investigations into war profiteering and specifically
Blackwater's conduct. Now that there has been a shift in power
in Congress, we are hopeful that your investigation, as well as
the investigations by Senator Dorgan and Senator Waxman, will
be taken seriously by these extremely Republican companies such
as Blackwater, who have been uncooperative to date and that
these investigations will be fruitful and meaningful.''
And Mr. Prince, you may recognize that name, because I
believe they also are the attorneys for some people who are
suing you.
Mr. Prince, first of all, let me give you a little
background, probably, as to why you are here. There is a party
in Congress that does not like companies who show a profit. If
you are wealthy, they figure you should have paid more taxes or
that you are a crooked businessman. They do not understand
someone who is an entrepreneur and offers a valuable service
that is above its competitors and that is based at a
competitive price.
They want to fight a war with no casualties. They exploit
our children, whether it is with a plan that will socialize
medicine in this country or the horrible situation when
innocent children are victims of an act of war. They often have
hearings such as this to bias lawsuits that their crony lawyer
friends may be handling.
There is no cost too high for them for citizens to pay,
citizens of this country, whether it is the price of personal
integrity or more of their wealth, as long as it moves forward
with the ultimate goal of distribution of wealth of the
successful for the takers of this world.
They love to have their cake and eat it too, though. For
instance, they think the Iraqi government is corrupt and inept,
but yet they question you about taking one of your former
employees out of the country with the government's permission.
Another example, they say the military should be doing your
job, yet they don't want additional troops sent to the theater.
One more example, Mr. Prince, is they complain about what
our military personnel make, and then they complain about what
you pay the same people that they complained about making so
little. So you can see that there is some confusion.
I also want to point out to you that 9 of the 22 Members on
this panel that voted voted that they agreed with MoveOn.org's
attack on General Petraeus.
Let me ask you, Mr. Prince, well, let me say, some of
Blackwater's critics have stated that the firing of personnel
has been surprisingly frequent. Have you or your managers ever
fired an employee for doing a good job?
Mr. Prince. Not that I know of.
Mr. Westmoreland. I don't think anybody does, do they? So
if one of your employees was doing a bad job or not meeting
your criteria, then those were some of the people that you got
rid of, right?
Mr. Prince. If they don't hold to the standard, they have
one decision to make: window or aisle.
Mr. Westmoreland. And Mr. Prince, what kinds of
professional backgrounds do most of your security personnel
have?
Mr. Prince. All of our personnel working on the WPPS-type
contract come from the U.S. military or law enforcement
community. They have a number of years of experience doing that
kind of work, ranging from 5, 8 years up to 20 or 30 years of
experience. They are discharged honorably, most of them are
decorated. They have gotten out of the military to choose to
take another career path. So we give them the ability to use
those skills back again working for the U.S. Government.
And let me just say, we are not a partisan organization.
That is not on the interview form when you come to work for
Blackwater, what party you affiliate with at all. We affiliate
with America. And the idea that people call us mercenaries, we
have Americans working for America, protecting Americans.
Mr. Westmoreland. And I think you do a very good job.
Mr. Prince. And the Oxford Dictionary defines a mercenary
as a professional soldier working for a foreign government. And
Americans working for America is not it. Yet we have a handful
of, we call them third country national folks, folks from Latin
America, they guard some gates and they guard some camps. They
don't leave that area, they are static guards. Our PSD guys are
Americans working for America.
Chairman Waxman. The gentleman's time has expired.
Mr. Braley.
Mr. Braley. Thank you, Mr. Chairman. Mr. Prince, my best
friend married Mary Lubbers, whose father and grandfather were
the presidents at Hope College.
Mr. Prince. Small world.
Mr. Braley. So I want to start by asking you about a
statement you made on page 3 of your written statement that you
shared with the committee, ``The company and its personnel are
already accountable under and subject to numerous statutes,
treaties and regulations of the United States.'' And then you
went on and attached to your statement a list of existing laws,
regulations and treaties that apply to contractors and their
personnel. Is that the document that I am holding up that you
attached?
Mr. Prince. Yes, sir.
Mr. Braley. Is it your testimony today, under oath, that
all Blackwater employees working in Iraq and Afghanistan are
subject to the Uniform Code of Military Justice, the Military
Extra-Territorial Jurisdiction Act and the War Crimes Act?
Mr. Prince. It is my understanding that is the case, yes,
sir.
Mr. Braley. All right, well, let's look at this document, I
want to ask you about it. This document, the Uniform Code of
Military Justice, applies in the time of declared war. You
would agree that there has been no declared war in Iraq or
Afghanistan?
Mr. Prince. No, but I believe it has been amended to
include contingency operations.
Mr. Braley. Is it your understanding that a contingency
operation would apply to what is going on in Iraq and
Afghanistan?
Mr. Prince. I am not a lawyer, but my layman's
understanding is yes.
Mr. Braley. All right. And then it says to persons serving
with or accompanying an armed force in the field. Do you see
that?
Mr. Prince. I don't have it in front of me, but you are
reading from it.
Mr. Braley. Well, I am just reading from the document that
you provided to us.
Mr. Prince. Right.
Mr. Braley. If that is what the Uniform Code of Military
Justice provides, you would agree that based upon your own
description of the activities of your company, there are times
when your employees are not serving with or accompanying armed
forces in the field.
Mr. Prince. There are times when U.S. military units are
actually embedded in our motorcades.
Mr. Braley. But to answer my question, there are times when
your employees are not serving with or accompanying armed
forces in the field, isn't that correct?
Mr. Prince. Sir, I am not a lawyer. So I am not going to
give you that level of detail. If you want a clear written
statement as to the accompanying opinion, I am sure the State
Department can answer what their opinion is on that. But we
have looked at it and we feel comfortable that our guys could
be brought under investigation with those ruling legal
authorities over their heads.
Mr. Braley. Then let's look at the Military Extra-
Territorial Jurisdiction Act, Section 3261, Criminal Offenses
Committed by Certain Members of the Armed Forces and by Persons
Employed by or Accompanied by the Armed Forces Outside the
United States. You would agree that there are circumstances
where your employees would not meet that definition based upon
their service in Iraq and Afghanistan.
Mr. Prince. I believe that was changed yet again to include
any U.S.-funded contract.
Mr. Braley. Well, that is the definition that applies to
U.S.-funded contracts from the statute.
Mr. Prince. Again, I am not a lawyer, sir. I am sorry.
Mr. Braley. Then let's look at the War Crimes Act of 1996,
which applies if the perpetrator is a U.S. national or a member
of U.S. armed forces. You would agree based upon your testimony
today that there would be circumstances when some of your
employees would not meet the definition of perpetrator to be
covered by the War Crimes Act.
Mr. Prince. Again, I am not sure, sir.
Mr. Braley. Well, you testified that you hire some third
country nationals. They would not be U.S. nationals, would
they?
Mr. Prince. That is correct.
Mr. Braley. And they would not be members of the U.S. armed
forces.
Mr. Prince. But they are serving in a U.S. DOD contingency
operation.
Mr. Braley. Then let's talk about these payments that have
been made as a result of deaths that were related to the
conduct of Blackwater employees. One of the payments that we
have been provided information about was this $15,000 payment
to the guard's family who was guarding Iraqi Vice President
Mahdi. Are you familiar with that payment?
Mr. Prince. Yes, sir.
Mr. Braley. Did you have any input into the determination
of the amount of that payment?
Mr. Prince. I discussed it with some State Department
officials, yes.
Mr. Braley. Did you feel that it was a satisfactory level
of compensation for the loss of that individual?
Mr. Prince. I believe the cash that was paid was actually
$20,000, not $15,000.
Mr. Braley. All right, $15,000 or $20,000. Based on the
information that we have been provided, one of the things we
know is that Blackwater charges the Government $1,222 a day for
the services of some of its employees, is that correct?
Mr. Prince. I believe that number is lower. The chart that
we provided the committee shows a blended average significantly
less than that.
Mr. Braley. Assuming that figure is correct, if you take
someone your age in the United States and look at the U.S. life
table, you will find that somebody your age in this country has
a life expectancy of 40 years. So if you were to take that rate
of $1,222 a day, multiply it times 365 days a year, multiply it
by a 40 year life expectancy, you would get a total lifetime
earnings payout of $17,841,200. You would agree with me that
pales in comparison to a payment of either $15,000 or $20,000.
Chairman Waxman. The gentleman's time has expired. You can
answer the question.
Mr. Prince. Your calculations there don't make any sense to
me, because that charge, that $1,200 charge that you are
talking about, claiming that we charge the Government, that
includes aviation support. Some of those helicopters that got
shot down, that comes out of our hide. Gear, training, travel,
all the rest. So I am not quite sure how that math works out.
But I would be happy to get back to you if you have any written
questions.
Chairman Waxman. The gentleman's time has expired.
Mr. McHenry.
Mr. McHenry. Thank you, Mr. Chairman.
I want to go through a few facts and make sure we have this
on the record. The gentleman is discussing cost, and I want to
sort of understand all the facts before we get to a conclusion
here. You were previously in the Navy SEALs. How long were you
in the military, sir?
Mr. Prince. In 1992 through the end of 1996.
Mr. McHenry. What is the average time, having been in the
SEALs, perhaps you would know this, what is the average time a
special forces operator is in the service?
Mr. Prince. Five or 6 years, up to 20. It really varies.
Mr. McHenry. But based on your experience?
Mr. Prince. Guys really make a decision point at about 12
years whether they are going to stay for a career or get out.
So I would say 10 to 12 years.
Mr. McHenry. All right. Let's say an operator retires from
the military, at which point a Navy SEAL, average Navy SEAL is
doing a much more, a much different operation, they are dealing
with explosives rather than defensive caravans and convoys.
What do you do with those individuals? Do you take Navy SEALs
and put them right in there, onto the streets? Is there
training for Blackwater?
Mr. Prince. The personnel that deploy for us, they go
through, obviously we have the resumes, we do a criminal
background check on them. When they have been accepted, when
the resume has been accepted by the customer, they come in for
training, they go through another 164 hours of training,
embedding at Blackwater, tactics, techniques, procedures,
driving, firearms, defensive tactics. They go through a full
psychological evaluation, medical/dental exam, physical tests,
shooting tests. There is a very, very rigorous pre-deployment
program they all have to do.
Mr. Braley. A significant amount of expense?
Mr. Prince. Yes. And that is all baked into that daily
cost.
Mr. Braley. Just for the record, when was Blackwater
formed?
Mr. Prince. In 1997.
Mr. Braley. At what point did you receive your first
Government contract?
Mr. Prince. For the first number of years, our customers
were individual SEAL platoons or a Marine recon platoon or an A
team. It was down to the individual team sergeant or warrant
officer paying with a credit card. Our first big Government
contract that we won competitively was the Navy force
protection contract that they started off after the Cole was
blown up. We had a $1\1/2\ billion ship blown up by two guys in
a Zodiac.
Mr. Braley. What year was that?
Mr. Prince. We started that in 2001.
Mr. Braley. OK. Who is your client in Iraq?
Mr. Prince. Department of State.
Mr. Braley. OK. How many competitors do you have within
this contract?
Mr. Prince. There are two others. There was a big
competition before then to be down-selected for the WPPS
contract.
Mr. Braley. How is that contract awarded?
Mr. Prince. It is awarded competitively. You go through an
enormous proposal process, they come and inspect your
facilities, your training standards, the resumes of each of
your personnel. They even have to accept and inspect the
resumes of the instructors you are going to have. And they come
and audit the program on an almost weekly basis.
Mr. Braley. So let's go forward. There are roughly 1,000
Blackwater contractors, operators, these former veterans that
you now have trained that are out securing embassy staff and a
number of civilians in Iraq. Let's say it is 1,000, just for
our purposes here. Roughly how much administrative staff do you
have associated with those 1,000 individuals?
Mr. Prince. We run that whole program, instructors, program
management people, that sort of thing, with less than 50
people.
Mr. Braley. With less than 50 people?
Mr. Prince. Yes, sir.
Mr. Braley. So roughly it is 1,000 to 50, is the ratio from
operators in the field to administrative staff?
Mr. Prince. Yes, sir.
Mr. Braley. All right. Now, there is this notion, we are
not the Armed Services Committee here, but there is this notion
of tooth to tail ratio, which means how many operators do you
have in the field and the expense of them, how much
administration function do you have. In active duty military,
based on your recollection, what is that rough estimate?
Mr. Prince. What is the DOD's tooth to tail ratio?
Mr. Braley. Yes.
Mr. Prince. I have seen as high as 8 to 1 or even 12 to 1.
One tooth, 8 to 10, 12 tails.
Mr. Braley. So one individual in the field, 12 individuals
outside of operating. So the ratio, when these people on the
committee talk about the expense of having that one operator in
the field, it is far less for an individual contractor, when
you are a private security contractor like you are in Iraq, it
is far more efficient for the total program to have a
contractor, because their tooth to tail ratio is far better
than what it is in the active duty military.
Therefore, the cost of that one operator in the field for
all the support services they have associated with them is far
less for a company like Blackwater than it is for the active
duty military. And can you, and my time is up, but if you can
actually discuss this with the committee and maybe in a minute
or so explain the expense of the overall operations.
Chairman Waxman. The gentleman's time is up, but Mr.
Prince, you may go ahead and answer.
Mr. Prince. I would just encourage the committee, and would
be happy to make some suggestions on areas where you could do a
true activity-based cost study, what does it cost the U.S.
Government to do X, Y, Z functions in the field, and do an
accurate drill-down. Because unless you know what something
costs, everything before that or after that is hyperbole.
Mr. Braley. Is it your contention that it is far cheaper--
--
Chairman Waxman. The gentleman's time really has expired.
Mr. Braley [continuing]. For you to operate in the field? I
just want him to answer this question, if I could, Mr.
Chairman. Is it your contention that it is much cheaper to the
taxpayers for your activities as a contractor with the
Department of State than it would be for active duty military
to do the very same task because of that tooth to tail ratio?
Mr. Prince. Yes, and because it is tough for the military
to be all things to all people all the time. If they are going
to have air defense artillerymen, all the other conventional
warfare specifications they have to have, it is tough for them
to do all things all the time.
Chairman Waxman. If you have some kind of document that
backs up your statement, we certainly would like to see it, and
we would like to ask you to provide it to our committee.
Mr. Prince. Yes, sir.
Chairman Waxman. Thank you.
Ms. McCollum.
Ms. McCollum of Minnesota. Thank you, Mr. Chair. Mr.
McHenry and I had the opportunity to go to Afghanistan
together, where in fact the military did provide, when we went
out on visits, did provide our security. I also had the
opportunity of being in Iraq, where we had a private security
detail take us from point to point. And I just, there has been
some discussion about who is more caring about getting on the
ground and seeing what is going on, and I just wanted people to
know for the record here that I have been both places and under
both circumstances.
I would like to followup a little more on what Mr. Braley
was talking about. You provided this chart on contractor
accountability. And you have made the statement that the DOD
can bring charges against your contractors. Can the Department
of State bring charges against your contractors?
Mr. Prince. I believe that would be done by the Justice
Department. They do the prosecuting of those laws.
Ms. McCollum of Minnesota. Under the CPA Order 17,
contractors have immunity from the Iraqi legal system, is that
correct?
Mr. Prince. That is my understanding, yes.
Ms. McCollum of Minnesota. So if a Blackwater contractor
would commit, as what an investigation might determine would be
murder, on their own time, it was a Christmas Eve holiday that
you were describing, or Christmas holiday, do you believe the
Iraqi government would not be able to charge that individual
with a crime, even on their own time?
Mr. Prince. That is my understanding, yes.
Ms. McCollum of Minnesota. Do you believe that immunity
should be repealed, if something happens when someone is ``off
duty'' and an Iraqi is murdered?
Mr. Prince. I believe U.S. laws should be enforced, and you
can have that justice system back here in America work.
Ms. McCollum of Minnesota. So you believe that the immunity
under CPA Order 17 should stand?
Mr. Prince. I believe so. I am not sure any foreigner would
get a fair trial in Iraq right now. I think they would at least
get a fair trial here in the United States.
Ms. McCollum of Minnesota. Your charts indicate that
contractors are accountable under the Uniform Code of Military
Justice. Your contractors work for the Department of State. Is
the Department of State accountable under the Uniform Code of
Military Justice?
Mr. Prince. I will not be presumptuous to answer for the
Department of State, ma'am.
Ms. McCollum of Minnesota. Well, you have provided this.
You told Mr. Braley that all your employees are under this
chart. So then you are saying that----
Mr. Prince. Well, ultimately that is for the Justice
Department to decide which avenue of jurisdiction they have.
Ms. McCollum of Minnesota. So this is just what you feel
that people might be held under accountability with your
contract? This is just a feeling you have? You don't know any
of that for a fact, do you?
Mr. Prince. I have legal opinions that I respect, put that
together and they gave their opinions that those were laws that
State Department contractors, DOD contractors, contractors for
the U.S. Government could be held accountable under.
Ms. McCollum of Minnesota. So whether it is a feeling or an
opinion, you cannot state for a fact, for a fact, that any of
your contractors that have a State Department contract can be
held accountable under the Uniform Code of Military Justice?
Mr. Prince. That is correct, ma'am, because that is for the
Justice Department to decide.
Ms. McCollum of Minnesota. I think that is important to
clear that up. Do you operate in a military capacity or a
civilian capacity?
Mr. Prince. Civilian capacity.
Ms. McCollum of Minnesota. So now you are saying that
civilians----
Mr. Prince. Our men are not serving members of the U.S.
military.
Ms. McCollum of Minnesota. So you are saying that civilians
can be held accountable to the Uniform Code of Military Justice
in your opinion?
Mr. Prince. And I believe that is why they extended that,
not just to wars that were declared but also to contingency
operations as well.
Ms. McCollum of Minnesota. To your knowledge, have there
been any military courts or civilian courts that have held any
of the contractors who have been charged or been accused of a
crime in Iraq?
Mr. Prince. It is my understanding there is a conviction of
a contractor that was working for the CIA that was convicted in
North Carolina for actions in Afghanistan.
Chairman Waxman. The gentlelady's time is expired.
Ms. McCollum of Minnesota. Thank you, Mr. Chairman. Thank
you for answering my questions. I appreciate it.
Chairman Waxman. Mr. Jordan.
Mr. Jordan. Thank you, Mr. Chairman.
Mr. Prince, I too want to thank you for your service to our
country and for the good work that your company has been doing
in Iraq and Afghanistan.
I just want to pick up on a couple of things that the
Congressman from North Carolina had talked about, just some
general questions. I know you have been sitting there for 3
hours. Just a few questions, then I am going to yield some time
to the gentleman from California.
How many employees, you mentioned before a little bit
earlier, 1,000 in the field, 50 administrative, but does that
represent the entire work force at Blackwater?
Mr. Prince. We have about 550 full-time folks in the United
States, 1,000, 1,100 or so in Iraq, and then hundreds more in
little pockets around the world. The next greatest
concentration would obviously be Afghanistan, there are about
300, 400 there.
Mr. Jordan. So a couple of thousand?
Mr. Prince. More or less, yes, sir.
Mr. Jordan. And you mentioned the extensive training, some
of the special operations individuals who come to work for you
after they leave military service and the training they
undergo, I believe you said earlier that there was a study done
that shows there is no higher exit rate, or quicker exit rate,
we will say, because of your company versus what typically
happens. Is that true?
Mr. Prince. Right. It was a GAO study and it was not just
directed at us, it was directed at the private security
industry.
Mr. Jordan. And real quickly, in your testimony, your
opening paragraph, you talk about you provide training to
America's military and law enforcement communities who then
risk their lives to protect Americans in harm's way overseas.
So are there several types of contracts that your company does?
You do training contract with the Government, protective
contracts, or do you do one contract per year? Tell me how
those work.
Mr. Prince. We have a number of different contracts. We
never started this operation to be a security provider. We
started as a training facility. The SEAL teams, special forces,
Marine recon, SWAT teams, those were our customers for the
first few years. The Navy came after the Cole was blown up. We
have trained well over 100,000 sailors since then on how to
protect their ships.
Through one of our affiliates, we do aviation support in
Afghanistan.
Mr. Jordan. Mr. Prince, how many contracts would you have
right now with the Federal Government? Any idea?
Mr. Prince. More than 50.
Mr. Jordan. OK.
Mr. Prince. Some are very small, some are very big.
Mr. Jordan. Again, I want to thank you for your service.
And Mr. Chairman, if I could yield to the gentleman from
California.
Mr. Issa. I thank the gentleman.
I just wanted to point something out, Mr. Prince. Did you
see the memorandum dated October 1st, that is yesterday, that
is entitled Additional Information about Blackwater USA? It
comes out of Mr. Waxman's office, it is 15 pages.
Mr. Prince. I did see that, yes.
Mr. Issa. OK. Did you note that on page 5, Mr. Waxman and/
or his staff said the following: ``Blackwater is owned by Erik
Prince. Mr. Prince is a former Navy SEAL who owns the company
through a holding company.'' After that, it begins to talk
about the White House, your father, your father-in-law, your
sister, etc., and basically talks about everything I asked you,
the Michigan Republican party, the donations.
So Mr. Chairman, hopefully you will appreciate that it was
your staff that created everything that I brought up, and you
put it out in writing 1 day before this hearing. My question to
you, Mr. Prince, is have you ever seen a bio about your life
that starts off, you were a Navy SEAL and then goes on to
everything your sister did on behalf of the Michigan party and
your Republican credentials? Is this the first time you have
seen a bio like this?
Mr. Prince. I love my sister very much, but it is not often
our bios get printed together. [Laughter.]
Mr. Issa. And you know, it is interesting, because I am
noticing that for this committee, a donor search done on
September 29th, at opensecrets.org, was done to find out how
much money you gave to who. Did you know that?
Mr. Prince. I did not know that.
Mr. Issa. Do you think that is really germane to today, or
do you think that attempts to paint you as a Republican
supporter?
Mr. Prince. I don't think it is germane to today. I think
we do good work and I am mighty proud of the folks we have
doing the work.
Mr. Issa. OK, I heard a rumor that your company or someone
in your company had given to the Green Party. Do you know about
that?
Mr. Prince. It could have been.
Mr. Issa. OK. I just wanted to know that there were people
on both the far left and the far right relative to the chairman
who may have benefited by your company.
But Mr. Chairman, I would ask that page 5 of your memo be
considered as what I called it, an attempt to pain this
gentleman and his company through Republican eyes to a Democrat
base for political purposes. And I stand by my statement, Mr.
Chairman, and yield back to the gentleman from Ohio.
Mr. Davis of Virginia. Could I just ask one clarification,
Mr. Chairman?
Chairman Waxman. Yes.
Mr. Davis of Virginia. Your first contract, Mr. Prince,
Government contract, was in 1997, wasn't it?
Mr. Prince. Yes. Well, no, our first customer, we started
the business in 1997, first customer was January 1998.
Mr. Davis of Virginia. First Federal customer----
Mr. Prince. That was the SEAL team.
Mr. Davis of Virginia [continuing]. That was under the
Clinton administration?
Mr. Prince. Yes, sir.
Mr. Davis of Virginia. Thank you.
Chairman Waxman. The gentleman's time has expired.
I would like to now recognize Mr. Cooper.
Mr. Cooper. Thank you, Mr. Chairman.
Mr. Prince, in the charter or by-laws of your corporation,
either the holding company or Blackwater, does it say
explicitly that it will only work for the United States of
America or its entities?
Mr. Prince. No, it doesn't. If I could clarify, anything we
do for any foreign government, any training, of anything from
law enforcement training to any kind of aviation training,
tactical flying, any of that stuff, all of that is licensed
back through the State Department, another part of the State
Department.
Mr. Cooper. But you are the owner of the company, the CEO.
If limitations like this are not in the charter and by-laws,
isn't there a risk that should something happen to you that
different management, in order to maximize profits, might seek
contracts from any number of other foreign countries, like of
Vladmir Putin offered a lot of money, why would you want to
turn that down as a business entity?
Mr. Prince. Because we would be violating Federal law and
the whole place could be shut down very, very quickly.
Mr. Cooper. But you are assuming a State Department license
would apply.
Mr. Prince. Oh, it does.
Mr. Cooper. You are a regular, private company. You can----
Mr. Prince. No, sir, I am sorry. We have to have a license
to train----
Mr. Cooper. I am not talking about training other people's
private police. Say you took some of your former people who
were former Navy SEALs, special forces, whatever, and they were
working for hire, what prevents you in your current company
charter or by-laws, prevents you from hiring out those people
to foreign governments?
Mr. Prince. U.S. Federal law does.
Mr. Cooper. Which law?
Mr. Prince. Defense Trade Controls Act. Any training, any
security services, any export of any weapons, any equipment you
would use to do that job requires a license. And on top of
that, this idea that we have this private army in the wings is
just not accurate. The people we employ are former U.S.
military and law enforcement people, people who have sworn the
oath to support and defend the Constitution against all
enemies, foreign and domestic. They bleed red, white and blue.
So the idea that they are going to suddenly switch after having
served honorably for the U.S. military and go play for the
other team, it is not likely.
Mr. Cooper. But these are independent contractors or
employees, they are supposed to do what they are told. And is
your omission of this key bit of information from the charter
or by-laws only due to the fact that it would be redundant? If
it is assumed, why don't you go ahead and put it in the charter
and by-laws that these people, this company will only work for
the United States of America and its entities? Why wouldn't
that be a nice addition to the charter and by-laws?
Mr. Prince. That wouldn't make any sense, because we have
NATO allies helping in Afghanistan, helping the U.S. mission
there. And there might be opportunities for us to support,
provide them with training or aviation support or logistics or
construction, a lot of other things that allies need,
especially as the United States is trying to build capacity
around the world. There are a lot of countries that need help
building out their police departments, giving them more
counter-terrorism capability.
Mr. Cooper. Twenty-six NATO allies. So you could work for
any of them?
Mr. Prince. Twenty-six NATO allies, but more and more, the
United States is doing FID missions, foreign internal defense.
We have done a number of successful programs for them working
with the U.S. Government, where they hire us, we go in and we
build that capacity and train them and provide the equipment,
all of which is licensed by the State Department. When we apply
for that license, it goes to the State Department and they farm
it out to the relevant part of the DOD to control and authorize
that licensing. What is the curriculum going to be, what
tactics, even down to which individual in which country is
going to be trained, so they can do a check on them. So that is
all controlled by the U.S. Government already, sir.
Mr. Cooper. On your Web site, it says that you were
contracted to enhance the Azerbaijan Naval Sea Commandos
Maritime Interdiction capability. Is Azerbaijan a member of
NATO?
Mr. Prince. No, but that was paid for by the U.S.
Government.
Mr. Cooper. Well, let me ask another question.
Mr. Prince. It was part of their regional engagement
policy. I don't make that policy, sir.
Mr. Cooper. Wouldn't it be nice to put in your charter and
by-laws that you only work for United States or U.S.-approved
entities? Why would that be harmful to your company?
Mr. Prince. We would be happy to do that. But it is
absolutely redundant, because we can't work for someone that is
not U.S.-approved.
Mr. Cooper. Redundancy is a small objection to making sure
that you are a loyal U.S. company.
Let me ask another question. What if a large company inside
the United States of America wanted to hire your company for
services, say, to break a strike or for other purposes like
that? Is that allowed under your charter and by-laws?
Mr. Prince. That is not something we have even explored.
Mr. Cooper. But it would be permissible under your current
company charter? It is a new line of business possibly?
Mr. Prince. No.
Mr. Cooper. It might be very profitable?
Mr. Prince. It is not something we are looking at, not part
of our strategic plan at all, sir.
Mr. Cooper. I know, but you are a mortal human being. Your
company would allow it, according to its current charter and
by-laws?
Mr. Prince. Well, I have five boys I am raising, so one of
them perhaps will take over some day.
Mr. Cooper. Why not put it in the charter and by-laws?
Thank you, Mr. Chairman. I see that my time is expired.
Chairman Waxman. Mr. Cooper, your time is expired.
Mr. Hodes.
Mr. Hodes. Thank you, Mr. Chairman.
Mr. Prince, thank you for being with us today.
Mr. Prince. Thanks for having me sir. I am glad I could
come here and correct some facts.
Mr. Hodes. There has been some discussion from the other
side of the aisle about whether or not these hearings are
partisan. Do you agree that it is not a partisan issue to
examine whether or not the use of private contractors,
including Blackwater, is advantageous to American taxpayers?
Mr. Prince. It is certainly part of the Congress to make
sure the money is spent well that taxpayers pay.
Mr. Hodes. And do you also agree that it is not a partisan
issue to inquire whether failures to hold Blackwater personnel
accountable for misconduct undermine our efforts in Iraq?
Mr. Prince. It is a fair enough thing to look into.
Mr. Hodes. Earlier today you were asked what action
Blackwater took to penalize an employee who while drunk, shot
and killed and Iraqi security guard for the Iraqi vice
president on Christmas Eve of 2006. Do you recall those
questions?
Mr. Prince. Yes, sir.
Mr. Hodes. And you responded that Blackwater fired and
fined the employee, but you are not sure of the amount of the
fine. Do you recall that?
Mr. Prince. Yes, sir.
Mr. Hodes. Blackwater, at the committee's request, provided
the committee an internal Blackwater e-mail that appears to
reflect a discussion of what Blackwater did to this employee.
It is dated Monday, January 8, 2007, approximately 2 weeks
after the incident in question. And it says, ``Regarding
termination, he has forfeited the following compensation that
he would have otherwise been authorized: return airfare,
$1,630; completion bonus, $7,067; 4th of July bonus, $3,000 and
a Christmas bonus of $3,000.'' Now, it appears to me that the
so-called fine consisted of taking away the contractor's
bonuses and making him pay his own way home. Is that accurate?
Mr. Prince. And any forthcoming compensation that he had. I
don't know when the guy's contract would have ended, but yes,
we took away whatever else we could.
Mr. Hodes. How long had he worked for your company?
Mr. Prince. I have no idea.
Mr. Hodes. Do you know what he had been paid during the
time of his employment up to the time he shot and killed the
Iraqi guard?
Mr. Prince. I have no idea, sir.
Mr. Hodes. Do you have any idea what your profit on that
employee had been up until the time of this incident?
Mr. Prince. Probably in keeping with the 10, 10\1/2\
percent indicated on our chart.
Mr. Hodes. Would you have records that would show us what
you had paid him up until that time and from which we could
find out what profit you had made?
Mr. Prince. I am sure we could dig through that and find
it, yes, sir.
Mr. Hodes. And would you be willing to provide that to us?
Mr. Prince. I will get my people right on it.
Mr. Hodes. I am asking for it now, so I would like to have
that sent. Thank you very much.
Chairman Waxman. Without objection, the document you used
for your questioning will be made part of the record.
Mr. Hodes. Thank you.
[The information referred to follows:]
[GRAPHIC] [TIFF OMITTED] T5219.037
Mr. Hodes. Mr. Prince, you also said that Blackwater is
extremely scrupulous in enforcing your standards. And you have
told us that you did basically all you could to this employee
and that the rest was up to the Department of Justice. What you
did was you took away his bonuses, July 4th, completion bonus,
Christmas bonus, he paid his own way home and he couldn't work
for you any more.
Mr. Prince. And made sure his clearance was canceled as
well.
Mr. Hodes. Is that your idea, Mr. Prince, of corporate
accountability?
Mr. Prince. Could you say the question again, sir, please?
Mr. Hodes. Is that your idea, Mr. Prince, of corporate
accountability?
Mr. Prince. This employee, I can't make any apologies for
what he did. He clearly violated the rules that he knew. We
give each of our guys an independent contractor handbook. It is
all the dos and don'ts of what they are expected to do and not
do.
Beyond firing him for breaking the rules, withholding any
funds we can, we can't flog him, we can't incarcerate him, we
can't do anything beyond that. That is the sole reservation of
the U.S. Justice Department.
Mr. Hodes. The Justice Department has not acted against
this individual?
Mr. Prince. I believe their investigation is ongoing.
Mr. Hodes. They haven't done anything so far, right?
Mr. Prince. We are not privy to that information, sir.
Mr. Hodes. This was a potential murder, was it not?
Mr. Prince. It was a guy that put himself in a bad
situation.
Mr. Hodes. Would you agree with me that this was
potentially a murder, sir?
Mr. Prince. Beyond watching detective shows on TV, sir, I
am not a lawyer, so I can't determine whether it would be a
manslaughter, a negligent homicide, I don't know. I don't know
how to nuance that. But I do know he broke our rules, he put
himself in a bad situation and something very tragic happened.
Chairman Waxman. Thank you, Mr. Hodes.
Mr. Sarbanes.
Mr. Sarbanes. Thank you, Mr. Chairman.
Actually, I want to followup on that line of questioning a
little bit more. I think you said that when people violate the
rules in a significant way, they have one decision left to
make, which is aisle or window, right?
Mr. Prince. Because they are fired.
Mr. Sarbanes. They are on their way out, they have one
decision, and that is whether to sit on the aisle or sit by the
window.
And then the other consequence that Mr. Hodes spoke to was
the financial penalty that they would experience. But it just
seems like a few thousand dollars, particularly against a
pretty lucrative contract that they would have had. And it
strikes me that if that is the only deterrent that is at work
in terms of people performing at a high level, that is not
much. In other words, you can say, well, let me get in here,
let me make a good living here. And if I screw up, and if I
screw up in a terrible way, as this one incident illustrates,
then the worst that is going to happen to me is I am going to
have to choose between an aisle seat or a window seat and maybe
give up a bonus and my last paycheck, I mean, that is
essentially the consequence that they face, isn't that right?
Mr. Prince. I would also add that we endeavor to get their
security clearance pulled, canceled. And once that is done,
they will never work in a clearance capacity for the U.S.
Government again, or very, very unlikely.
Mr. Sarbanes. OK. But you would agree that it is not, it
doesn't have the same kind of deterrent effect that it would
have if they thought that they were going to be subject to
prosecution, if there was a clear set of rules in place, a
clear context in which they could be prosecuted, they could
face something akin to a court martial, or all the other kinds
of measures that can occur if you are in a traditional military
setting? You would agree that provides an extra level of
deterrence?
Mr. Westmoreland. Mr. Chairman, I think the witness has
already testified that he did everything that his company could
to this person----
Chairman Waxman. I'm sorry----
Mr. Westmoreland [continuing]. And that he is not the
prosecutor.
Chairman Waxman [continuing]. You are not acting in
accordance with the rules.
Mr. Sarbanes. Well, I am actually, I am headed in the
direction----
Chairman Waxman. This is not a court case. The gentleman
has time and I am going to restore his time. He can ask
whatever he wants and to say whatever he wants. Some people on
this committee have said completely outlandish things. Nothing
we can do about it. They have their right, including you. You
read a whole blasphemous statement about Democrats, but no one
objected to that.
So the gentleman is going to be recognized for an
additional minute.
Mr. Sarbanes. In any event, would you agree that would
provide some extra deterrence, some extra reason for people to
exercise their conduct in a careful way?
Mr. Prince. We welcome that level of accountability. Most
of our people have already served in the U.S. military or they
served in a law enforcement capacity. They are used to that
kind of accountability and transparency into what they are
doing.
Mr. Sarbanes. Well, I appreciate your saying that, because
I----
Mr. Prince. We are not hiding anything.
Mr. Sarbanes. Yes. I would like to leave aside the question
of whether you should be, Blackwater should be in this space
that you are in. I don't know enough about the history of
whether providing the sort of protective services that you do
is something that isn't done by the military traditionally, or
is. So I am going to leave that aside. I am also leaving aside
the issue of the cost, which strikes me as exorbitant, in terms
of what the taxpayers are paying here. You keep calling for, I
think, an activity-based cost analysis or assessment, which I
think we would be happy to get more information about. I have
to believe there is a less expensive way, even to hire private
contractors like yourself.
And so I am really left with the accountability issue as
the one that strikes me as front and center here. And as I have
listened to your testimony, in particular you are saying with
respect to this one person who was drunk and committed this
homicide, I will characterize it that way, I think you said you
would be happy to see that person prosecuted, something akin to
that. And I would like to enlist you as an advocate to
strengthen whatever the rules of engagement are, whatever the
statutes are that are out there. Mr. Braley took us through
these various things and you indicated that you weren't sure
whether each of those necessarily reached as far as they could
in providing that kind of penalty environment. I would like you
to speak to whether it would be a good thing to make sure that
it does.
Mr. Prince. I believe Congressman Price from North Carolina
has been pushing to amend some of that language. And we support
that fully.
Mr. Sarbanes. Thank you.
Mr. Cooper [presiding]. The gentleman yields back his time.
The next questioner on the list from the chairman looks
like Mr. Welch.
Mr. Welch. Thank you, Mr. Chairman.
Mr. Prince, thank you for coming. I want to ask a few
questions about the finances. My understanding is that
Blackwater had contracts with the Federal Government in 2001 in
the amount of $736,000.
Mr. Prince. It could easily be, yes, sir.
Mr. Welch. And in 2006, that number had exploded to $593
million.
Mr. Ryan. May I have just 1 minute, please?
Mr. Prince. I am not sure.
Mr. Welch. Well, you don't dispute it. This is what is in
the report that was referred to earlier.
Mr. Prince. Well, some of the later years on that report
aren't quite accurate. So I am not going to discount the whole
thing.
Mr. Welch. OK. According to the report, 51 percent of the
Blackwater contracts were no-bid contracts, $493 million that
were explicitly no competition, and $30 million were awards
after limiting or excluding qualified bidders. Is this more or
less correct? Any reason to dispute it?
Mr. Prince. It could be, sir. I don't know.
Mr. Welch. All right. And since 2003, when the war began,
Blackwater contracts have exceeded $1 billion, correct?
Mr. Prince. I don't know the answer, sir. If you have
specific questions on financials, we will get you the answers.
Mr. Welch. Well, these are facts that are in the record.
You can check them out. But I will just advise you----
Mr. Prince. Well, there is some stuff in the committee's
report that is not accurate. So I can't agree to the entire
committee report.
Mr. Welch. Let me continue going through this. One of the
concerns that has been expressed is that a sergeant who
provides security services in a full military setting is paid
$50,000, $60,000. If it is an employee from Blackwater, the
cost to the taxpayer is about $445,000. Is that more or less
correct?
Mr. Prince. Could I have a copy of what you are reading
from, at least?
Mr. Welch. Well, you have been asked about this by several
Members already. Let me just continue.
Let's talk a little bit about training. You were a SEAL and
served with distinction, as I understand it, as a SEAL,
correct?
Mr. Prince. Yes.
Mr. Welch. And your training as a SEAL was beneficial to
you in the work that you are doing now as the head of this
company?
Mr. Prince. It helped form me in my life, absolutely.
Mr. Welch. And you had also I think indicated that
Blackwater hires our military veterans and law enforcement
veterans, many of whom have recent military deployments,
correct? It makes sense to do that?
Mr. Prince. Yes.
Mr. Welch. So it is fair to say that Blackwater as a
company in recruiting personnel has benefited from the
taxpayer-financed training of people that Blackwater hires,
correct?
Mr. Prince. We have people that have prior honorable
military service and provide them an opportunity to use those
skills again at their highest and best use.
Mr. Welch. And it is fair to say that Blackwater contracts
have in fact surged since 2003 when the war began, correct?
Mr. Prince. The nature of the security environment around
the world has changed, yes.
Mr. Welch. And it is true, or is it true that as reported
by the Center for Responsive Politics, you did make, as you
have a right to make, contributions of $225,000 to the, that
include $160,000 to the Republican National Committee and the
National Republican Campaign Committee?
Mr. Prince. I don't know that sitting here right now.
Again, I can go back and dig through our contribution records
to figure out exactly what we gave in what period.
Mr. Welch. Well, that is the report that we have been
given. And again, you have a right to do that. My concern is
the nature of the contracts.
Now, you are also aware that General Petraeus, who is in
command of 160,000 troops, is paid by taxpayers $180,000 for
the extraordinary responsibilities that he bears for our
security in Iraq, correct?
Mr. Prince. I don't know what General Petraeus gets paid.
Mr. Welch. Well, that is what it is. Blackwater has 861 or
so personnel, according to this report in 2006, in Iraq. Is
that more or less right?
Mr. Prince. It could be, yes, sir.
Mr. Welch. All right. General Petraeus is paid $180,000 for
supervising 160,000 troops. How much were you paid in 2006?
Mr. Prince. I'll get back to you with that exact answer. I
don't know.
Mr. Welch. Well, you can give me an estimate.
Mr. Prince. More than $1 million.
Mr. Welch. Well, as I remember, when my colleague, Mr.
Hunter, asked you about your contracts, you indicated 90
percent of your Blackwater contracts came from the Federal
Government, correct?
Mr. Prince. Yes.
Mr. Welch. I.e., the taxpayer. And he asked you what your
profit margin was, and my recollection of your testimony today
was about 10 percent?
Mr. Prince. That is what the report that we submitted to
the committee says, yes.
Mr. Welch. So walk through the math with me. If Blackwater
has had $1 billion in contracts since the war began in 2003,
and there is a 10 percent profit margin, that is $100 million
in profit, is it not?
Mr. Prince. This is representative of one of the WPPS
contracts. Some contracts we lose money on, some we lose all
kinds of money on. Some we make money on.
Mr. Welch. Mr.----
Mr. Prince. Understand we have significant variables.
Mr. Welch. You were asked a question and you gave an
answer. And the question was very simple. It is the kind of
question that a CEO pays real attention to: what is your profit
margin. Your answer was, 10 percent. I am doing the math, $1
billion, 10 percent, $100 million.
Mr. Cooper. The gentleman's time is expired.
Mr. Prince. Some contracts we lose money on. Losing three
helicopters this year is certainly beyond the scope of math.
Mr. Cooper. The next questioner is Mr. Murphy.
Mr. Murphy. Thank you very much, Mr. Chairman.
Let me just followup on Mr. Welch's question. Certainly, as
a CEO of a company, you can tell us what your profit has been
in the past several years as a company.
Mr. Prince. I can give approximate numbers, but we are a
private company. And I am sure it is the Congress's main
interest in maintaining healthy competition amongst Government
vendors. So we are a private company, and there is a key word
there, private.
Mr. Murphy. And so you will not disclose to us what the
profit, what the annual profit or----
Mr. Prince. No, that is not what I just said. We gave you
an example of what the profitability of a WPPS contract looks
like. But I am not going to go into our full financials.
Mr. Murphy. And I guess, I am a new Member of Congress, but
as a representative of my constituents that pay 90 percent of
your salary, pay 90 percent of the salaries of your employees,
I think it is a little difficult for us to fathom how that
information isn't relevant to this committee or this Congress.
Mr. Ryan. Mr. Chairman, may I have a minute with the
witness, please?
Mr. Cooper. Yes.
[Witness and counsel confer.]
Mr. Prince. I am sorry. Go ahead.
Mr. Cooper. Mr. Murphy has 4 minutes left. The hearing will
resume.
Mr. Murphy. Thank you, and I want to wrap up so Mr. Lynch
can ask some questions before we break. So let me ask the
question again after your consultation with your colleague. It
is your position that you don't believe that it is in the best
interests of your company or this committee to have discussions
with the U.S. Congress about the profit that you make off of
U.S. Government contracts?
Mr. Prince. We can have that discussion, but I am not fully
prepared, sitting here today, to answer each and every one of
your questions down to that level of detail.
Mr. Murphy. I am not asking for a level of detail. I am
asking for an approximation of your annual profit, based on the
fact that you make 90 percent of your money from U.S.
taxpayers.
Mr. Prince. Again, we will come back to you. If you have
written questions, we will give you written answers after the
hearing is done.
Mr. Murphy. Because you testified today that you are not
sure of that number?
Mr. Prince. I am not sure of that number. How can I
calculate in depreciation on assets when our helicopters parked
around near the embassy in Baghdad get hit by rockets all the
time, that they get fragged, that three of them have been shot
down? There is a whole host of variability to our
profitability, depending on when an asset is expended or
destroyed.
Mr. Murphy. Mr. Prince, I am not a businessman. But I find
it pretty hard to believe that the CEO of a major company in
this country, whether it be privately financed or publicly
financed, can't give an approximation of your annual profit on
a year to year basis.
Mr. Prince. I think when the committee meets with any of my
finance folks, they will tell you I am not a financially driven
guy.
Mr. Murphy. Let me just ask one other quick question before
I yield back. You made a comment before that you had a handful
of third country nationals working for you. And not to
disparage the need to have third country nationals working for
the company, but I just want to get a better handle on what a
handful has. The memo that we have before us, and I understand
you draw issue with some of those numbers, so I want to get it
straight, suggests that of the 861 Blackwater personnel in Iraq
today, 243 of them are third country nationals. Does that sound
right?
Mr. Prince. Your best bet is drawing off of page 1 of what
we submitted to the committee, where it says, ``UCTCN or HCN.''
Mr. Murphy. What percentage of those serving in Iraq under
Blackwater are third country nationals? By your numbers.
Because by our numbers, it is just less than one third, which
doesn't sound like a handful. That sounds like one third of all
your personnel are not U.S. citizens.
Mr. Prince. Well, I am looking at one here. It shows 576
United States, 129 TCN and 16 locals.
Mr. Murphy. So again----
Mr. Prince. So divide 129 by 576 and you get your
percentage.
Mr. Murphy. OK. Sounds like a little bit more than a
handful, but I appreciate your testimony and I yield back.
Mr. Cooper. The gentleman yields back his time. The next
questioner is Mr. Lynch.
Mr. Lynch. Thank you, Mr. Chairman. And I want to thank the
witness for his perseverance here today and for helping the
committee with its work.
We have heard a lot today about the loss of accountability
when an inherent Government function, in this case duties that
are incidental to the prosecution of war, are subcontracted out
to private entities. And as Mr. Shays and Mr. Platts have
mentioned earlier, my Republican colleagues, I also have had an
opportunity to view first-hand on more than a few occasions the
work of Blackwater employees. I would guess that in the dozen
or so occasions when I have traveled with my colleagues to Iraq
and Afghanistan, your area of operations, principally, I would
bet at least half of those times, or at least a portion of time
there, we have been protected by Blackwater employees.
And based on my own personal experience, I have to say,
from personally what I have seen, and what I have experienced,
those people who were protecting us who were Blackwater
employees did a very, very good job. I have to give you credit
for that. They are brave employees, brave Americans in a very
hostile environment.
I find myself right now with this committee having a
difficult time criticizing those employees, because I am in
their debt. That is a very hostile environment and they do a
good job on our behalf.
Which brings me to my problem. If I have a problem
criticizing Blackwater and criticizing the employees and some
of the times that you have fouled up, what about the State
Department? The State Department employees, you protect them
every single day. You protect their physical well-being, you
transport them, you escort them. And I am sure there is a heavy
debt of gratitude on the part of the State Department for your
service.
And yet they are the very same people who are in our system
responsible for holding you accountable in every respect with
your contract and the conduct of your employees. And I know
from my own experience, in the time there, that is an
impossible conflict for them to resolve.
I have here in my possession, I am going to ask that they
be entered into the record in a minute, some internal e-mails
from the State Department. These documents that the committee
has received raise questions again about the State Department's
oversight of Blackwater's activities under the contract. Even
in the cases involving the death of Iraqis, it appears that the
State Department's primary response was to ask Blackwater to
make monetary payments to--this is from the e-mails--``to put
these matters behind us,'' that is, the deaths of Iraqi
civilians, ``rather than to insist upon accountability or to
investigate Blackwater personnel for potential criminal
liability.'' The most serious consequence faced by a Blackwater
personnel for misconduct appears to be termination of their
employment.
Even though Secretary of State John Negroponte asserted
that every incidence in which Blackwater fires its weapons is
``reviewed by management officials to ensure the procedures
were followed,'' the documents that we have before the
committee don't indicate that. I do have some e-mails, though.
And this one is dated--I will ask these to be entered into the
record, Mr. Chairman.
Mr. Cooper. Without objection, so ordered.
[The information referred to follows:]
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Mr. Lynch. This one is dated July 1, 2005 from RSO Al-
Hillah. This is a situation where Blackwater personnel fired
and killed. It says, ``This morning, I met with the brothers of
an adult Iraqi male who was killed by a gunshot to the chest at
the time and location where the PSD, in this case, Blackwater
team, fired shots in Al-Hillah on Saturday, June 25th of
2005.'' The gentleman in question was killed. And then it says,
``Gentlemen, allow me to second the comments on the need for
Blackwater to provide funds ASAP. For all the reasons
enunciated in the past, we are better off getting this case and
any similar cases behind us quickly. Again, the Department of
State needs to promptly approve and fund an expedited means of
handing these situations. Thanks.'' And it mentions $5,000 for
the family there.
Again, another e-mail dated December 26, 2006. And it says,
this is again a situation where Blackwater personnel killed an
individual civilian innocently, standing near an area where the
convoy was traveling, it criticizes the way the charge
d'affaires was talking about ``some crazy sums. Originally she
mentioned $250,000 and later, $100,000. Of course, I think that
a sum this high will set a terrible precedent. This could cause
incidents with people trying to get killed by our guys to
financially guarantee their families' future.''
Mr. Cooper. The gentleman's time has expired.
Mr. Lynch. I am going to wrap up here. And again, I am
going to ask these to be placed in the record.
Mr. Cooper. I am afraid----
Mr. Lynch. The question is, based on that arrangement----
Mr. Cooper [continuing]. The gentleman's time has expired.
Mr. Lynch [continuing]. Does it not make sense that an
independent inspector general, instead of the State Department
inspector general, review these? I think it would help the
credibility of the company to have an independent inspector
general reviewing these cases instead of having the State
Department basically make you pay up $5,000 every time----
Mr. Burton. Mr. Chairman, I have high regard for the
gentleman from Massachusetts but has gone 2 or 3 minutes over
his time.
Mr. Cooper. The gentleman's time has expired.
I need to ask the witness, we have two questioners
remaining. If you would like to take a break now, that would be
fine. Or there are about 10 minutes of questions remaining. It
is your call.
Mr. Prince. If there are two questions left, I will take
them and let's be done.
Mr. Lynch. Mr. Chairman, do you want to give the witness a
chance to answer that last question?
Mr. Cooper. Well, the gentleman considerably exceeded his
time limit. We had actually given you considerably more than
the 5-minutes due to a mistake in the clock. So I think we need
to keep this in regular order.
The gentlelady is recognized, Ms. Norton.
Ms. Norton. Thank you, Mr. Chairman.
Mr. Prince, I want to be clear that however you serve your
country, whether as a member of the armed forces or now as a
contractor in time of war, the American people are indebted to
you. We understand that the risk is the same.
I want to avoid confusing the higher purpose of the
volunteer army with what some nations, how some nations
candidly operate. However you define mercenary armies, some
nations have long used mercenary soldiers to deal in foreign
countries with unpleasant tasks. The more dependent we become
on contractors, the more we risk falling right off the cliff
into a mercenary army that is nothing that you would have
responsibility for.
But it must be said, people fight wars that, countries
fight wars where the people support them. And the people
support them by being willing to provide the troops to fight
those wars. That is a risk we have.
I want to ask you a question or two about your contract
with the State Department. Under this contract, you employ
security personnel as independent contractors rather than as
your own direct employees, isn't that right?
Mr. Prince. Yes, ma'am.
Ms. Norton. You don't have to provide employee benefits,
such as health or disability insurance, vacation or retirement
and the like as a result?
Mr. Prince. Each of the individuals that deploys for us has
a very robust insurance package that is with them every day
they are working for us.
Ms. Norton. You also can avoid making Social Security
contributions or withholding taxes, is that not true?
Mr. Prince. I am not sure on that.
Ms. Norton. I believe that is true, sir.
By contrast, DynCorp and Triple Canopy and other security
firms that support the State Department treat their personnel
as employees entitled to these benefits. Why do you treat your
personnel differently from these two companies?
Mr. Prince. I don't know the differences in how they
compensate their people. I will tell you we have the highest
retention in the industry. We have guys that sign up for us at
a very, very high rate. So we don't get losses. Men and women
seem to feel very well treated by us.
Ms. Norton. Well, of course one of the differences is in
the employee benefit package I have just named. Does Blackwater
hire personnel as independent contractors in order to avoid
legal responsibility for the company?
Mr. Prince. No, it is actually really what the men that
deploy for us prefer. We find it is a model that works.
Ms. Norton. Well, Mr. Chairman, it may in fact----
Mr. Prince. They like the flexibility of signing on for a
certain period of time and being able to schedule their off
time around an anniversary, a child's birthday, being home for
Christmas, etc. So it gives them flexibility as to when they
are going to deploy, when they are going to go to work. Just
like----
Ms. Norton. Does it really give them more flexibility than
the other two companies who have them as employees? Those
people don't have the same kind of flexibility? What kind of
flexibility can you have if you need your employees at a time
of engagement, for example?
Mr. Prince. I don't know, ma'am.
Ms. Norton. Well, I think the fact is, when you need them,
you need them. You don't say, you can go home for Christmas,
sir.
Mr. Chairman, I think we should, I am very disturbed, very
disturbed by this confusion, which amounts to legal confusion
about the responsibilities of contractors. I will concede the
notion that employees can choose whether they want to work for
a company that in fact requires them to save for their own
benefits or not. My confusion----
Mr. Prince. Ma'am, let me just add, we have a program that
allows them, it is like an individual 401(k) plan. So they are
able to, while working for us, able to have a 401(k)-like
program.
Ms. Norton. I understand that. Probably the other
employees, excuse me, companies, that I mentioned probably also
have 401(k) programs. And again, my major concern is not what
private employees decide to do.
Mr. Chairman, my concern is that these Blackwater
contractors, so far as I can see, operate under the direct
command or are supervised by Prince, Mr. Prince and his
company. They are, they operate under the law of the United
States in some fashion. It is simply unclear, after a full
day's hearings, whether these employees, whether this company
is subject to law in the way that the American people expect
anybody in a field of combat to in fact be subject to the law
of some place. I believe we need an investigation, Mr.
Chairman, by the GAO to clarify what law if any such companies
and their employees, whether contract employees or not, should
answer to.
Mr. Prince. If I could just answer, ma'am, I think the FBI
investigation regarding the September 16th incident proves that
there is a measure that accountability is in place, that
process is working. And as for us----
Chairman Waxman [presiding]. That remains to be seen.
Mr. Prince [continuing]. Working for us overseas, we
provide the trained person with the right equipment, the right
training, the logistics to get them in and out of theater, when
they get to Iraq or to Afghanistan, they work for the State
Department. We work under that, the RSO's operational control,
they are not under our operational control.
Chairman Waxman. Thank you, Ms. Norton.
Ms. Schakowsky.
Ms. Schakowsky. Thank you, Mr. Chairman. I really
appreciate your allowing me to participate in this hearing, and
I thank the committee for their indulgence.
I wanted to let everyone know that I am shortly going to be
introducing legislation to carefully phaseout the use of
private security contractors, for-profit companies that carry
out sensitive missions that have repeatedly and dramatically
affected our mission. I want to recognize the mother of Jerry
Zovko, who is here today. Jerry was an Army Ranger before
becoming a Blackwater employee. He died in Fallujah in an
infamous mission, fraught with mistakes on the part of his
Blackwater supervisors. That was over 3\1/2\ years ago, and led
to the Battle of Fallujah during which many of our U.S. forces
lost their lives.
As Mr. Davis, the ranking member, said, we need a
conversation in this Congress about that, and I am hoping that
my legislation will provide that.
Mr. Prince, in your testimony you stated Blackwater
personnel supporting our country's overseas missions are all
military and law enforcement veterans. You did not state that
they were all Americans, all American military and law
enforcement veterans. Is it true that Blackwater hires foreign
security personnel?
Mr. Prince. One of your colleagues previously asked that
question. Yes. Some of the camp guards, gate guards, static
locations are indeed third country national soldiers.
Ms. Schakowsky. And in 2004, Gary Jackson, the President of
Blackwater USA admitted that your company had hired former
commandoes from Chile to work in Iraq, many of which served
under General Augusto Pinochet, the former dictator of Chile.
As you must know, his forces perpetrated widespread human
rights abuses, including torture and murder of over 3,000
people. Did Blackwater or any of its affiliated companies at
that time, at any time, use any Chilean contractors with ties
to Pinochet?
Mr. Prince. Well, I can say Mr. Jackson did not admit to
hiring some commandoes. Yes, we did hire some Chileans. Any
foreign national soldier that works for us now, for the State
Department, has to have a high public trust clearance. It is
basically a security clearance for a third country national
soldier where you take their name, it goes back through the
U.S. embassy in that country and their name is run, kind of
like a national agency check here, which is what someone does
for a security clearance. That way we can ensure that they have
no criminal record, ma'am.
Ms. Schakowsky. I understand that one of your business
associates, Jose Miguel Passaro, was indicted in Chile for his
role in supplying commandoes to serve Blackwater. Is that
correct?
Mr. Prince. He was not an associate. He might have been a
vendor to us.
Ms. Schakowsky. In your written statement today, you state
that Blackwater mandates that its security professionals have a
security clearance of at least the secret level. Did any
Chilean contractors who worked for Blackwater ever get a
security clearance?
Mr. Prince. I believe what I said is for the WPPS contract,
the Americans working on that are doing the PSD mission are
required to have a secret clearance.
Ms. Schakowsky. Did any Chilean contractors get a security
clearance?
Mr. Prince. I don't know, ma'am.
Ms. Schakowsky. Because if yes, they were provided with
classified information, if no, then it is not true that all
Blackwater personnel in Iraq have security clearances.
On your Web site, I don't know if it is still there, there
was a recent one, there was a jobs fair advertised in
Bucharest. And we have heard allegations that Blackwater
recruited Serbians and former Yugoslavs with combat experience
from the Balkan wars, some linked to atrocities committed in
Croatia and Kosovo and in Bosnia and associates of Milosevic. I
am wondering if you could talk to me about that for a minute.
Mr. Prince. To my knowledge, we have never employed anyone
out of those countries.
Ms. Schakowsky. Would you know?
Mr. Prince. There are some Romanians that were on a
contract that we took over from a previous vendor, competitor.
But we phased them out and we use guys out of Latin America
now.
Ms. Schakowsky. Would you know if people have been
associated with Pinochet or Milosevic before you hired them? Is
this part of your inquiry?
Mr. Prince. Again, for the State Department, for the static
guards that were utilized, third country national soldiers, a
high public trust clearance is required----
Ms. Schakowsky. I heard you say that.
Mr. Prince [continuing]. Where their name, their
background, their address, their date of birth, whatever
information is available on them, is run back through the
equivalent country that they are from, a national agency check,
to ensure that they don't have any criminal record, human
rights abuses, or any other bad marks against their name.
Ms. Schakowsky. OK, well, we should check into that
process. But let me ask a question. You said that you as a
company would not work overseas in any way that is not
associated, that the United States does not approve. However,
Chile has made a decision not to participate as part of a
coalition member in this war. They won't send any troops. Do
you have any qualms about hiring people out of Chile to
participate actively in this war?
Mr. Prince. We don't hire anybody from Chile right now, to
my knowledge.
Ms. Schakowsky. Have you ever?
Mr. Prince. I previously just said that we had, previously.
Yes.
Ms. Schakowsky. And so the answer is you don't have any
qualms about doing that, based on the fact that Chile has made
a public policy decision not to participate?
Mr. Prince. I believe the persons of that country have a
free right to contract. I will give you an example. The
Philippines doesn't allow their personnel to go to Iraq. So we
don't hire their people to go to Iraq.
Ms. Schakowsky. OK, but you do hire Chileans. Thank you. I
appreciate it.
Chairman Waxman. Thank you very much, Mr. Schakowsky.
Mr. Prince, let me thank you very much. You have been very
patient. You have been here a long time.
I do want to acknowledge the presence today of Rhonda
Teague and Kristal Batalona, the daughter and wife of Wesley
Batalona. Ms. Schakowsky acknowledged the mother of Jerry
Zovko, who is in the audience today. These are people from
Fallujah. I am sorry we didn't get a chance to ask you more
questions about Fallujah. I might, with your permission, send
you some questions and ask you to respond for the record.
Because that was an example, we had a hearing on that
issue, and that was an example where one of the ways
corporations could make money is not to have fully trained
personnel. I don't know if that was the case or not, but it
certainly appeared to us that the people were not given
adequate protection and training for that Fallujah mission and
it had an unprecedented consequence in the battle of Fallujah
that followed.
In closing, let me just say that we really have a
remarkably unprecedented experiment going on in the United
States today by having private military contractors. It raises
a lot of issues. It raises issues about costs, it raises issues
about whether it interferes with our military objectives. And I
think this hearing and with you and the next witnesses will
help us continue to sort through what that means for our
Nation. We have never had anything of this magnitude before
where we have turned so much of our military activity over to
private military that used to be, for the most part, provided
by the U.S. military itself.
I want to thank you. If Mr. Davis has any last comments, I
will recognize him.
Mr. Davis of Virginia. Mr. Prince, thank you very much. I
think you have--is there anything else you would like to add
after all this? Would you like to add anything you didn't get
to say?
Mr. Prince. Thanks for having me. I would invite some of
the leadership of the committee, if they would like, to come
and visit our operations. We would be happy to show you what we
do.
Mr. Davis of Virginia. Fine. Let me just say, I think we do
need a dialog, and our next panel will tell us the State
Department's rationale and the large number of contractors and
why they are utilizing that versus active duty. I think that
will give more clarification to Members.
Thank you very much.
Mr. Prince. Thank you, sir.
Chairman Waxman. We will proceed to our next panel, but we
want to give Mr. Prince and his group an opportunity to leave.
The committee will now continue on and proceed to our
second panel. We have with us Ambassador David M. Satterfield,
Special Advisor and Coordinator for Iraq, U.S. Department of
State; Ambassador Richard J. Griffin, Assistant Secretary,
Bureau of Diplomatic Security and Director of the Office of
Foreign Missions, U.S. State Department; and Mr. William H.
Moser, Deputy Assistant Secretary for Logistics Management,
U.S. Department of State.
I gather you are not taking your seats because you know you
are taking the oath. But it is the practice of this committee
to swear in all witnesses.
[Witnesses sworn.]
Chairman Waxman. The record will indicate that each of the
witnesses answered in the affirmative.
Your prepared statements will be in the record in full. We
would like to recognize each of you for an oral statement for 5
minutes, and then after that we will have questions that we
will want to pursue with you.
Ambassador Satterfield, if we might start with you.
STATEMENTS OF AMBASSADOR DAVID M. SATTERFIELD, SENIOR ADVISOR
TO THE SECRETARY AND COORDINATOR FOR IRAQ, U.S. DEPARTMENT OF
STATE; AMBASSADOR RICHARD J. GRIFFIN, ASSISTANT SECRETARY OF
STATE, BUREAU OF DIPLOMATIC SECURITY, U.S. DEPARTMENT OF STATE;
AND WILLIAM H. MOSER, DEPUTY ASSISTANT SECRETARY FOR LOGISTICS
MANAGEMENT, U.S. DEPARTMENT OF STATE
STATEMENT OF AMBASSADOR DAVID M. SATTERFIELD
Ambassador Satterfield. Thank you, Chairman Waxman, Ranking
Member Davis, members of the committee. Thank you for inviting
me here today and for the opportunity to speak to the vital
security that private security firms provide to our State
Department personnel.
In Iraq, as in Jerusalem, Gaza and the West Bank, I have
been protected by Blackwater and other private security
details. As you know, Mr. Chairman, I was the Deputy Chief of
Mission in Baghdad from the spring of 2005 until late summer of
2006. I witnessed first-hand what Ambassador Crocker has
rightly described as the capability and courage of our
protective details, as have many Members of Congress, including
some, Mr. Chairman, on this committee.
The contracting of security personnel for State Department
officials is neither new nor unique to Iraq. For example, we
have employed private protective security details, PSDs, in
Haiti, Afghanistan, Bosnia, as well as Jerusalem, Gaza and the
West Bank. We do not bunker down in dangerous environments. But
we do need, and we do take prudent precautions to protect the
safety and welfare of our personnel.
Iraq is a dangerous place. Yet I think we can all agree
that our diplomats and civilian personnel need to be able to
operate alongside our military colleagues and to have the
broadest possible freedom of movement throughout that country.
We must be able to interact with our Iraqi counterparts and
with the Iraqi population. Without protective security details,
we would not be able to have the interaction with Iraqi
government officials, institutions and other Iraqi citizens
critical to our mission there.
The State Department uses multiple security specialists in
Iraq. Furthermore, it should be noted that the Department of
State is not the sole client of these security companies. The
U.S. military, Iraqi government officials, private Iraqi
citizens, independent institutions and non-governmental
organizations as well as journalists all use private security
firms, of which Blackwater is one of many. A black Suburban
does not equal Blackwater.
Insofar as the State Department's security contractors in
Iraq are concerned, we demand high standards and
professionalism. Those standards include relevant prior
experience, strict vetting, specified pre-deployment training
and in-country supervision and oversight. As you know, many of
the individuals serving are veterans who have performed
honorably in America's armed forces.
All Embassy Baghdad security contracts fall under the
oversight of the regional security office. Those contracts
require high standards, covering areas ranging from conduct and
demeanor to use of force to mission operational guidelines.
Those standards are written into the companies' contracts.
These policies, these standards only allow for the use of force
when absolutely necessary to address imminent and grave danger
against those under their protection, themselves and others.
In those rare instances when security contractors must use
force, management officials at the embassy conduct a thorough
review in each and every instance to ensure that proper
procedures were in fact followed. In addition, we are in
constant and regular contact with our Iraqi counterparts about
such instances. And the incident of September 16th was no
exception.
I want to underscore, Mr. Chairman, the seriousness with
which Secretary Rice and the Department of State view both the
events of September 16th and the overall operations of private
security contractors working for the Department of State in
Iraq. At the direction of the Secretary, we are conducting
three different reviews. As I stated before, the embassy
conducts regular reviews of every security incident. We are
conducting a thorough investigation into and review of the
facts surrounding the events of September 16th.
At the request of the Department of State, the Federal
Bureau of Investigation is sending a team to Iraq to assist on
the ongoing investigation into that incident allegedly
involving Blackwater employees. The Secretary of State has made
clear that she wishes to have a probing, comprehensive,
unvarnished examination of the overall issue of security
contractors working for her Department in Iraq. And so we are
working on two different fronts, Mr. Chairman. Following direct
communication between Secretary Rice and Prime Minister Malaki,
our embassy in Baghdad and the Prime Minister's office have
established a joint government of Iraq and U.S. Government
commission to examine issues of security and safety related to
U.S. Government-affiliated protective security detail
operations.
This will also include review of the effect of CPA Order 17
on such operations. This joint commission will make policy
recommendations for resolving any problems it may uncover.
Finally, the Secretary has directed Ambassador Patrick Kennedy,
a very senior and extremely capable Department management
officer, to carry out a full and complete review of security
practices for our diplomats in Iraq. His review will address
the question of how we are providing security to our employees.
It will take into account all aspects of this protection,
including the rules of engagement and under what jurisdiction
they should be covered. Ambassador Kennedy is now in Baghdad
with some of his team.
In addition to Ambassador Kennedy, his team will ultimately
include General George Joulwan, Ambassador Stapleton Roy and
Ambassador Eric Boswell, outsiders who will bring with them
clear eyes and an independent view of what needs to be done.
This is an extraordinarily well-qualified team and it has
experience directly relevant to this review.
We are fully committed to working with both our security
specialists and the Iraqi government to ensure the safety of
U.S. Government personnel. Both are and will be essential to
our success.
With that, Mr. Chairman, Assistant Secretary Griffin,
Deputy Assistant Secretary Moser and I are happy to take your
questions.
[The prepared statement of Ambassador Satterfield follows:]
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Chairman Waxman. Neither of you two have opening
statements? You are just here to answer questions, is that
correct? Thank you.
Mr. Ambassador, when Mr. Prince was testifying here earlier
today, we asked him about that very disturbing incident on
Christmas Eve, 2006. The basic facts of the incident are that a
Blackwater contractor shot and killed an Iraqi security guard
working for the Iraqi vice president. According to the
documents the committee received, Blackwater transported the
shooter out of Iraq within 36 hours of the killing, and it did
so with the approval of the Baghdad embassy's regional security
officer.
Why did the State Department facilitate the departure of
the Blackwater contractor suspected of murdering one of the
Iraqi vice president's security guards?
Ambassador Griffin. As you know, the incident that you
described is presently in the Department of Justice for a
prosecutive review. I think that to pre-judge exactly what
occurred that evening as far as the facts of the case go would
be inappropriate for me at this time.
[The prepared statement of Ambassador Griffin follows:]
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Chairman Waxman. I am not asking about the facts of the
case. I am asking you about the State Department's response.
Why did the State Department respond in this way?
Ambassador Griffin. At the time of the incident, after a
number of interviews were conducted, there was no reason for
him to stay in Baghdad.
Chairman Waxman. Well, the committee had a briefing from
Ambassador Kennedy last week, and he stated that the subjects
of investigation should be kept in-country, because the
investigators may need access to them. In fact, when you think
about this, this is an obvious point. Why didn't you follow the
policy recommended by Ambassador Kennedy?
Ambassador Griffin. You can't describe how a case should be
handled universally. Each case has to be judged on its own
merits. And Ambassador Kennedy may have had some other notion
about the proper way to proceed.
Chairman Waxman. Well, this is not an ordinary case. This
is a pretty extreme one. You have a private military contractor
within the Green Zone, which is an internationally protected
area, shoot and kill an Iraqi security guard. What we saw was
that within 36 hours, he was ushered out of the country and the
State Department helped that happen. In fact, the documents
show that the primary response of the State Department was to
ask Blackwater to make a payment to the family in the hope that
this would make the problem go away. There is even a discussion
among State Department officials about how large the payment
should be. One official suggested $250,000, but this was
reduced instead to just $15,000.
Yesterday during the State Department's daily press
briefing, the agency's spokesman said, ``We are scrupulous in
terms of oversight and scrutiny not only of Blackwater, but all
of our contractors. I would strongly dispute anyone's assertion
that the State Department does not exercise good and strong
oversight in our efforts to manage these contractors.'' That
was the statement made yesterday.
When I look at the State Department response to the
Christmas Eve shooting, I don't see scrupulous oversight and
scrutiny. I see an effort to sweep the whole incident under the
rug. How would you respond to that?
Ambassador Griffin. I would say that the area of what laws
are available for prosecution is very murky. I believe it is
something that the executive and legislative branches have been
working on to try and clarify. And I think that lack of clarity
is part of the problem.
Chairman Waxman. So you weren't sure at the State
Department whether this was a possible criminal violation, when
a person hired by a contractor of the United States shoots and
kills an Iraqi in the Green Zone? There is a question of
whether this is criminal? Is that why the State Department
helped get him out of the country and gave Blackwater a
suggestion of how much to pay to get rid of the whole incident?
Ambassador Griffin. That is your judgment that is what
happened. I was not there. I think that is why the Department
of Justice is examining this case. And they are examining the
potential ways that it might be prosecuted.
Chairman Waxman. Well, it just seems to me common sense to
say that if there is an examination going on, and the man is
not there any longer, you can't pursue some of those issues.
And the ones that pursue the investigation are the ones right
there on the ground. You don't get the guy out of the country
as fast as possible and then say we did what we thought was a
responsible thing to do. Even the deputy director of the trade
association representing private security contractors sees a
problem. He told the Washington Post, ``Blackwater has a client
who will support them no matter what they do.''
As I view the record, it shows that the State Department is
acting as an enabler to Blackwater tactics. The company acts as
if they are untouchable for a simple reason: the State
Department demands no accountability. They are not accountable
to the military. They are not accountable to the Iraqi criminal
system. And the State Department, who is the contractor, seems
to have acted like they are helping Blackwater get rid of the
guy so that the whole incident can go away.
Ambassador Griffin. The incident was referred to the
Department of Justice of our country for their prosecutive
decision and followup. They are the prosecutors. The State
Department isn't the prosecutive department for the U.S.
Government.
Chairman Waxman. Have the State Department people been
asked any questions by the Department of Justice about this
issue?
Ambassador Griffin. I am sure there has been conversation,
but I can't----
Chairman Waxman. You should, but you don't know?
Ambassador Griffin. No, I can't name when and where.
Chairman Waxman. The fact of the matter is, it seems
strange that if there is this kind of situation, there hasn't
been any action by the Justice Department to date. This is
almost, well, not quite a year, but this is the fall, nine, 10
months later. I wonder what really is going on.
Mr. Davis.
Mr. Davis of Virginia. Thank you. My good friend here said
that this was unprecedented in terms of the amount of security
going on over there, private security. I just wonder, Mr.
Satterfield, my understanding is the State Department has been
contracting for security services at diplomatic posts
throughout the world for decades. Is this unprecedented?
Ambassador Satterfield. The scale of the operation in Iraq
is unprecedented. But the fact of contracting, both through
direct hire, and by use of private security contractors, such
as Blackwater, DynCorp, Triple Canopy and others, is certainly
not unprecedented. It is practiced at a number of posts in a
number of countries around the world.
Mr. Davis of Virginia. If you could go back 4 years, would
you have taken this in-house or would you stick to what we are
doing at this point in terms of contracting out?
Ambassador Griffin. At the time that the decision was made
to use contractors, it was made because there was an immediate
need to provide security for U.S. Government employees working
in a hostile environment, trying to assist the Iraqi people in
standing up various civilian agencies. Everyone knows that the
military was doing their function there. We were trying to
stand up the civilian side of the government, which was pretty
much in shambles at that time.
In order to fulfill that security mission, in order to be
able to immediately deploy people in the near-term, contractors
were used. The fact is, if we were to attempt to recruit and
train diplomatic security agents for that mission, it would
take anywhere from 18 months to 2 years to identify them, do
all the backgrounds, do the clearance work, 7 months of basic
training, follow-on training for high threat parts of the
world.
Mr. Davis of Virginia. Also, when the mission winds down,
what do you do with them at that point, too?
Ambassador Griffin. When the mission ends, you may have
more people than you have work for.
There are also specialists that are employed by the
contractors, people who have training in, helicopter pilots,
people who are mechanics for armored vehicles, people who are
armorers, people who are medical technicians, etc., that are
all part of the requirement that you have when you are working
in a combat zone. So for a multitude of reasons, it made good
sense to deploy people with the expertise that is needed but
for what was expected to be a short to medium term duration.
Mr. Davis of Virginia. But it has been a longer term
duration, hasn't it?
Ambassador Griffin. It has been. But the fact is, we have
used contractors going back to 1994 for this protective
security mission, when they were first used in Haiti. So those
previous contracts, some have come and gone, so it does
demonstrate that this is not a career-type assignment for
somebody.
Mr. Davis of Virginia. Is it cheaper to go outside, or
would it be cheaper to take them inside and basically start a
bureaucracy within the Government to handle these kinds of
things?
Ambassador Griffin. Mr. Moser can speak to all the contract
costs, but when you are looking at the cost of whether it is a
contractor or a person in the military or a person in the State
Department, you have to look at what we call the fully loaded
costs, which includes all of the expenses, which you are all
very well aware of from your dealing with the budget for all
these years. The fact is that the costs for a State Department
special agent to be deployed in a high threat area approaches
$500,000.
Mr. Davis of Virginia. Mr. Moser, do you want to comment?
Mr. Moser. Well, I will add one thing to that. We actually
do cost analyses in the acquisition activity. And I am very
proud of the cost analysis they do, because particularly, if we
have a situation, our first contract to Blackwater was awarded
in 2004. We did not have competition, so we had to actually do
extensive analysis at that time to make sure that the costs
were reasonable.
But to add to what Ambassador Griffin has said, I used to
work in an office called Global Support Services and
Innovation. We spent many, many months discussing how much it
actually costs to position an American overseas, an American
diplomat like me, or a DS agent. And their prices range from
around $400,000 for a regular mission around the world to
around $1 million for an American diplomat positioned in Iraq.
So when we talk about using contract employees, I think
that we have to be very careful to consider what the fully
loaded costs would be of direct hires, and as you have already
pointed out very wisely, Congressman Davis, you do have to
think about, do you really need these people for a long term.
Mr. Davis of Virginia. So basically, when we start
comparing costs, I think earlier someone used the analogy of a
sergeant being $60,000 to $80,000 a year, and a contract
employee being $400,000 a year, those aren't fully loaded costs
and it is not apples to apples. Would that be your opinion?
Mr. Moser. Well, I look at it this way. We have lots of
employees in Iraq and the missions around the world. Well, I
actually, also one of my duties is to run the transportation
part of the State Department. And that is where we move
people's household effects around the world. That activity
alone is around $220 million a year. That does not appear in
that employee's salary cost, that is something that we do for
each employee.
Mr. Davis of Virginia. So if you divided the number of
employees by the $220 million, you would get a high number?
Mr. Moser. That is right, and you can keep on adding these
costs. And as I said, in my previous assignment, we looked at
this. How do you amortize the building costs for over the
years, like what the rental price is?
Mr. Davis of Virginia. One of the things that Mr. Waxman
and myself and the committee ultimately want to understand is
really what are the costs. I don't know if we can get GAO to
look at that, or how we compare apples to apples in an
objective way. Because everybody has their own numbers on this.
And that is something that would be helpful to you, I would
think, as well.
Mr. Moser. It is very helpful to me. And I will say that
over the years, I have actually discussed this topic with a
number of employees at GAO. Because it is not an old topic, by
any means.
Chairman Waxman. Thank you, Mr. Davis.
Mr. Tierney.
Mr. Tierney. Thank you, Mr. Chairman.
Mr. Moser, can you tell us whether or not the number of
diplomatic security service agents has been reduced at the
State Department since 2001?
Mr. Moser. I think Ambassador Griffin is going to need to
answer that question.
Mr. Tierney. Ambassador, can you answer that question?
Ambassador Griffin. Current staffing is about 1,450, and it
does reflect an increase over the past 4 to 5 years. I have
been on board 2 years, and I know one of those years we brought
on 175 additional agents, and there were some brought on the
year before. But I could certainly give you the specifics for
the record if you would like to have that.
Mr. Tierney. Were any of those additional agents brought in
with respect to Iraq, or were they other places around the
world?
Ambassador Griffin. They are for various places around the
world. We have at the present time approximately 36 of our
agents in Iraq.
Mr. Tierney. Now, I think we can all agree that Baghdad is
not just any other embassy right now, it is the largest post
and it is in a war zone. There are about 800 personnel, I think
you said earlier, or told the committee earlier, that are
involved in the private security detail to protect embassy
personnel in Iraq, would that be accurate?
Ambassador Griffin. There are 845 Blackwater personnel in
Baghdad and Al-Hillah, and the other two contractors have
additional resources. So it is about 1,150 total.
Mr. Tierney. Are there any other embassies around the world
where the security details are that large?
Ambassador Griffin. I don't believe so.
Mr. Tierney. Now, just looking at some of the statistics
here, we have reports that say Blackwater engaged in shooting
incidents on 195 occasions in less than 3 years. That is about
1.4 times per week. Are there any other embassies around the
world in which the security details have been engaged in that
many shootings in the last 3 years?
Ambassador Griffin. I would say that the environment in
Iraq is unique and that we are operating in a combat zone.
Mr. Tierney. So is that a no?
Ambassador Griffin. As to whether anyone else has the same
level of----
Mr. Tierney. As to whether there is any other embassy
around the world where the security details have engaged in
that many shootings in the last 3 years?
Ambassador Griffin. Not that I can think of.
Mr. Tierney. And when we look at the Blackwater reports, we
also show that Blackwater has caused at least 16 casualties and
significant property damage from fired weapons on over 160
occasions in the last 3 years. Are there any other embassies
around the world in which security details have caused that
many casualties or that much property damage in the same period
of time?
Ambassador Griffin. No, but there are no other embassies
like Baghdad.
Mr. Tierney. Well, I think we established that in my first
question. I was fully in agreement with you that it was a
unique situation.
Ambassador Griffin. Thank you.
Mr. Tierney. So I think Blackwater thinks that all the
shootings were justified, and I think that raises another
question. You told us that there is a special use of force
policy specific to the embassy in Baghdad and that special
policy would allow security forces to do things that ordinarily
they might not be able to do, such as shooting at cars that get
close to the motorcades.
Are there in fact special rules on the use of force that
permit that type of shooting in Baghdad?
Ambassador Griffin. Yes, there are.
Mr. Tierney. OK. And is there any other place, other than
perhaps Afghanistan, is there any other place where those
special rules are in effect?
Ambassador Griffin. I can't say, as I sit here. Each post
in the State Department operates under a chief of missions
firearm policy. In most of our posts, they are fairly similar.
All of our agents operate under the normal DOJ guidance for
Federal law enforcement personnel for deadly use of force.
Mr. Tierney. I guess my point on the special rules that
apply to Iraq is that when you have those special rules and the
need for those special rules, are you going to be able to shoot
at cars that get within a particular distance of a motorcade
because you are concerned about an IED attack? That happens
over 160 times in 3 years? It appears to me that this might not
be a mission for civilian law enforcement agents, like the
diplomatic security or the contractors. It in fact might be a
mission for the U.S. armed forces.
So the real question we are trying to get at here as a
committee is, whether or not the diplomatic security has enough
agents may be beside the point, the question may be whether or
not this isn't a case where 800 troops or 845 troops actually
should be taking over that mission. And if we are fighting a
war and we have two different departments, State Department and
the Defense Department, maybe they ought to get together and
try to figure out when and how they are going to perform that
responsibility.
Let me just, in the time left to me, the brief time, just
ask a quick question here. On February 4, 2007, the Iraqi
government alleged that on that day, Blackwater shot and killed
Iraqi journalist Hana al-Ameedi near the Iraqi Foreign
Ministry. Is that true?
Ambassador Griffin. I am aware that there were a number of
allegations made about shootings in the newspaper. If I may, I
would like to describe what happens when one of our PSD teams
is involved in a shooting incident, so we can have a clear
understanding of how the procedures work.
Mr. Tierney. Could I ask you, in the course of doing that,
if the chairman is going to allow us to get into this, my way
of approaching that, if you would be good enough to work with
me on that is, let us know which of the incidents the State
Department has actually investigated, and then tell us whether
or not you can provide us with copies of that investigation and
then after you have done that, we will be happy to hear the way
that you go about doing it.
Ambassador Griffin. We will provide you copies of every
investigation that has been done.
The standard procedure is, when one of our protective
security details is on a mission and a weapon is fired, as soon
as they get back to the international zone, the team that was
involved in that incident comes to the tactical operations
center which is the hub for DS operations. Members of the team
are segregated, they are interviewed by DS agents to report
what had happened.
Within 24 hours they have to provide a written, sworn
statement as to what happened. The statements are reviewed to
make sure that the statements are consistent as to what
occurred. They are reviewed by management at the post and on a
parallel track, on a weekly basis, our people who manage our
overseas protective operations have weekly meetings with our
contractors. So at the same time, they are also exchanging
information about any incident that might have occurred during
the course of that week.
Chairman Waxman. Thank you, Mr. Tierney.
Mr. Burton.
Mr. Burton. Thank you, Mr. Chairman.
I will probably ask you some questions that we asked of the
CEO of Blackwater, because I would like to get a perspective of
that from the State Department.
First of all, would it be more effective if we used active
Army personnel to provide these services? Would it be more cost
effective or generally more effective?
Ambassador Griffin. I think that the professional men and
women in the armed forces could do this mission, provided that
they were given the training that the professional security
specialists have. It is not the normal military training that
they receive to go out and fight a war. When you are in a
professional security mission where your mission is to protect
the person who is your principal and you come under fire, your
response is not to stay and fight, your response is to get off
the X.
Mr. Burton. So the mission is more defensive than
offensive?
Ambassador Griffin. That is right.
Mr. Burton. Several times it has been suggested that the
Department's contract with Blackwater and other firms was sole
source, a sole source contract. Was it awarded improperly or
not?
Mr. Moser. I think I need to take that question, Mr.
Burton.
In 2004, as the U.S. Government made the transition from
the Coalition Provisional Authority to a U.S. embassy presence,
we decided to do a sole source contract for Blackwater to
provide the personal security services that Blackwater
provides. That was the only time that this contract has been
sole sourced in the Department of State. The reason we did that
was for urgent, compelling reasons, and essentially, there was
a fully signed document by the proper officials within the
State Department that signed that justification.
We were under a very, very urgent situation to make that
transition. We had to make an effective transition and provide
the security services, so that the embassy could get up and
running.
That document for urgent and compelling reasons was signed
by the procurement executive of the State Department, by the
Department's legal counsel for acquisition, and by all the
necessary officials in both diplomatic security and in the
acquisition activity. We did not like doing a sole source award
to Blackwater, and therefore, at the close of 2004, we asked
our OIG to get an audit of their price proposal. And Mr. Waxman
actually put the results of that audit in his letter of
yesterday. We were very glad to see that there, because that
was an audit that the acquisition activity asked for.
The reason we asked for it is that sometimes we need an
outside audit to come in and take a look at a contractor to see
if the rates are correct. And the actual results of that audit,
we were able to take part of the Blackwater contract costs,
which were, Blackwater proposed around $140 million, and
negotiate those down to $106 million. So we think that the
audit was a very positive thing.
Then the next year, in 2005, this contract was incorporated
into the World-wide Protective Services Contract, and it was
competitively bid and awarded.
Mr. Burton. That was a very thorough answer.
In the opinion of the State Department, are the contractors
out of control, or are any of them untrained?
Mr. Moser. Well, I know that by the terms of the contract,
they are very well trained. I will defer to my colleagues in
diplomatic security to answer the question about out of
control. I am, as part of the contracting activity, I would not
make that judgment. But that is where we would rely on the
advice of the programmatic people.
Mr. Burton. Would one of you Ambassadors like to comment?
Ambassador Griffin. Please, if I may, Mr. Burton. All of
the WPPS contractors who are employed under the terms of that
contract must have at least 1 year of prior military
experience, prior law enforcement experiences. Very often the
military experience is special forces, the law enforcement
experience is SWAT-type experience.
Upon being identified they have to successfully undergo a
background check. They have to qualify for a secret clearance
from our Government. And they also have to go through a
training course, which has been prescribed by DS, of 164 hours
in order to give them specific training on the mission that
they will be tasked to do when they arrive in-country.
Mr. Burton. I see my time has expired. I had some more
questions, Mr. Chairman. Are we going to have a second round?
Chairman Waxman. I wasn't planning on it. How many more do
you have?
Mr. Burton. Just one or two more.
Chairman Waxman. Why don't you see if you can do the one or
two more?
Mr. Burton. Thank you, Mr. Chairman. I appreciate that.
Chairman Waxman. We will give you another minute.
Mr. Burton. When your contractors fire first at a vehicle
speeding toward a chief of mission motorcade, is that a
violation of the contract rules of engagement?
Ambassador Griffin. Absolutely not.
Mr. Burton. Tell me from your perspective what takes place,
what should take place? That will be my last question.
Ambassador Griffin. The use of force policy, which is
prescribed in the chief of mission policy in Baghdad and our
standard procedures for our high threat protection division,
one does not have to wait until the protectee or co-worker is
physically harmed before taking action.
We have an escalation of force policy in order to try and
take a number of steps, prior to having to go to the use of the
firearms that our people carry. On the back of all our
motorcade vehicles in Arabic and English there is a warning to
stay back 100 meters. These vehicles are operating with lights
and sirens. If a vehicle approaches from the rear when everyone
else has stopped or goes around stopped vehicles and appears to
be approaching our convoy, hand signals will be given, verbal
commands will be given in order to get the attention of that
driver, in order to get them to stop. If they still haven't
gotten their attention, they will shoot a flare at the vehicle,
which also will get their attention but it won't hurt anybody.
They will use a bright light to shine at the vehicle. If the
vehicle is still coming, they may even throw a bottle of water
at the vehicle.
Having all of those steps failed, they will put a round in
the radiator of the vehicle or a couple of rounds to try and
stop the vehicle. If the vehicle continues to come, realizing
the number of BB/IED attacks that occur in this environment,
they are then authorized, for their safety and the safety of
the people they are protecting, to shoot into the windshield in
order to stop that vehicle.
Chairman Waxman. Thank you, Mr. Burton.
Ambassador Griffin. It is the escalation of force policy,
as we call it.
Mr. Burton. Thank you, Mr. Chairman.
Chairman Waxman. Ms. Watson.
Ms. Watson. Thank you, Mr. Chairman.
The panel has spoken about how important private security
contractors are for the State Department and how good they are
at their jobs. Ambassador Griffin, in your prepared testimony,
you referred to private contractors as a skilled cadre of
security professionals. And Ambassador Satterfield, you
mentioned that you demand high standards and professionalism
from these contractors.
In general, do you feel that private security companies do
a good job in carrying out their mission of protecting State
Department personnel?
Ambassador Satterfield. Congresswoman, we do believe that
the overall mission of security contractors in Iraq is
performed exceedingly well, with professionalism, with courage.
The undertaking that the Secretary of State has made is to have
a comprehensive review of all of those operations, to look at
the mission, to look at the resources brought to the mission,
to look at all aspects of procedures, rules of engagement,
questions of jurisdiction and authority, to take a solid look
at whether something better can be done, whether there are
issues that need to be addressed. Then we are going to expose
that to outsiders for independent review.
Ms. Watson. Let me just cut you off. Are you doing that
review for all security or just for those in the theater in
Iraq?
Ambassador Satterfield. For all private security
contractors operating in Iraq.
Ms. Watson. OK. Now, you know I have been an ambassador. I
probably am the only one in Congress at the time, in the House,
that has been there. And I would insist that you do that.
Because I had an incident with a private contractor at my post
where he would knock trainees down and then kick them with the
point of his boot. I would have fired him, but the word back
from the State Department was that there was no one else to
hire. So I would hope that would be broad-based, the
investigation, and not just there.
One of the major reasons this committee has expressed some
skepticism about the use of Blackwater and other private
security contractors is because of the great respect we have
for all the men and women who wear the uniform in Iraq. And we
trust the military to face our most pressing challenges and
stand up to our greatest threats. And yet for all your
statements about the skill and professionalism of these private
contractors, and I am a witness, if you want to come and talk
to me privately, I will tell you about my experiences with
these private contractors.
So many in the military have been very critical of private
security contractors in Iraq, and especially Blackwater.
Brigadier General Karl Horst said, ``These guys run loose in
this country and do stupid stuff.'' ``There is not authority
over them.'' I was the authority over my security team when I
was the Ambassador, and I reprimanded them for how they treated
their trainees. ``So there is not authority over them so you
can come down on them when they escalate force. They shoot
people and someone else has to deal with the aftermath. It
happens all over the place.''
An Army lieutenant colonel serving in Iraq said of
Blackwater, ``They are immature shooters and have very quick
trigger fingers. Their tendency is to shoot first and ask
questions later. We are all carrying their black eyes.''
A senior U.S. commander serving in Iraq said, ``Many of my
peers think Blackwater is oftentimes out of control. They often
act like cowboys over here.'' Another U.S. military commander
put it bluntly: ``Iraqis hate them. The troops don't particular
care for them, and they tend to have a know-it-all attitude,
which means they rarely listen to anyone, even folks that
patrol the grounds on a daily basis.''
And I can go on and on. But I would like you to address how
we can, if you will, be sure that our military has the
training, you, the State Department contract, and you go to
private firms. If you see areas of our training that are
missing, would you make that recommendation to the Department
of Defense?
Ambassador Satterfield. Madam Congresswoman, there are
different missions in Iraq today. Certainly, the ones you raise
are ones that can be considered by the Department of Defense
and by the Joint Chiefs in terms of the mission to be assigned
to U.S. forces, whether in Iraq or elsewhere. I really can't
speak to that.
What I can speak to is the oversight and accountability
which the Department of State has and must exercise over those
private security contractors that work for us today in Iraq.
That is a responsibility we take quite seriously. It is a
responsibility that we will be carrying out in terms of this
overall review in a very comprehensive fashion and we will make
the results of that available.
Ms. Watson. OK, my time is up, and there is a call to go to
the floor. But I would just like to say in closing as I run out
the door, I think somebody from the State Department ought to
come and talk to me.
Chairman Waxman. Thank you, Ms. Watson.
Ambassador Griffin. We will get on your schedule at your
earliest convenience, and we look forward to talking to you.
Chairman Waxman. Mr. Shays.
Mr. Shays. Thank you.
Gentlemen, would you agree that there is a huge difference
between an ambassador in a country where there is not a threat
to their lives and the challenge that Ambassador would have
with a contracting team that is to protect them and one in
places like Jordan and other areas in the Middle East and
particularly Iraq? Is there not a big difference? In other
words, don't you have a lot more contractors having to secure
people in a nplace like Iraq versus what an Ambassador would
have to protect his or her well-being?
Ambassador Satterfield. Some of the personnel that we have
under contract----
Mr. Shays. I want you to move the mic closer, please.
Ambassador Satterfield. I am sorry?
Mr. Shays. Move the mic closer to you, please.
Ambassador Satterfield. Some of the people at our posts
around the world are part of our local guard force. And those
local guards----
Mr. Shays. You are not answering the question. I asked is
there a difference.
Ambassador Satterfield. There is a huge difference between
Baghdad----
Mr. Shays. Thank you, there is a huge difference.
Ambassador Satterfield. My point is there are guards----
Mr. Shays. Case closed. Let me take the next question. I
only have 5 minutes. It's an easy answer. There is a big
difference. The men and women who are being defended in Iraq by
security people, their lives are in danger every day. Now, Mr.
Satterfield, isn't it true the Ambassador has responsibility in
Iraq for those security personnel?
Mr. Moser. Indeed he does, Congressman.
Mr. Shays. Thank you. And does he exercise it?
Mr. Moser. Yes, he does.
Mr. Shays. Thank you. Would you tell me, Mr. Satterfield,
can you describe the process that is followed by the
Department--excuse me. Let me ask this question. If there were
sufficient, I would like to know if there were sufficient
military personnel to provide armed escorts for convoys in
Baghdad and conduct protection, would you still use contractors
to provide such security?
Ambassador Griffin. As I mentioned a minute ago, Mr. Shays,
if the outstanding young men and women of the military received
training in protective security operations, then they certainly
would be capable of performing----
Mr. Shays. That is not what I asked. I want to know if you
have a preference for using--and I am sorry, these are
basically simple questions. I want to know if your choices
between people, outside contractors, or would you like to use
the resources of the military to have to spend their time to
protect State Department employees. Do you want State
Department employees to go around in HumVees with lots of
armored personnel, or would you prefer that they go around the
way they do in civilian clothes with people who are securing
them that aren't in Army uniforms?
If you prefer the Army, tell me to do it.
Ambassador Griffin. All I was saying is the Army would be
capable of doing it if it was done in the manner which we
prescribed, which would not be HumVees, they would not be in
uniforms. The protective security personnel that we utilize are
trained for that specific mission.
Mr. Shays. If they were Army personnel, would they be under
your command and oversight? Or would they be under the command
of the Army?
Ambassador Griffin. If they were performing a protective
mission of the Ambassador and other----
Mr. Shays. Do you command the Army or does the Army command
the Army?
Ambassador Griffin. The Army command the Army.
Mr. Shays. So the answer is, isn't it, that they would be
under the command of the Army and not under your jurisdiction
and oversight if they were in fact Army? I don't want to put
words in your mouth?
Ambassador Griffin. No, no. Well, I guess they would be.
Mr. Shays. I am just asking the question. Yes, sir.
Let me ask you this. Would it be a problem if in fact you
had no responsibility and they were to be answerable to the
Army? Generals and so on.
Ambassador Griffin. I think that is a national policy
consideration, as to the staffing levels of the Army to perform
that mission.
Mr. Shays. Well, as a Peace Corps volunteer, and I will
just make this point, the last thing you want when you are
going into the community is to come in with a military force.
What you want is to have a low profile. You want a protocol
that says you don't bring in tanks, you don't bring in HumVees,
you bring in a civilian car, you want people dressed in
civilian clothes for the most part, not dressed in Army
uniform.
Let me ask you in closing, Mr. Satterfield, when Mr. Bremer
went into places, wasn't one of the criticisms that he was
going in with the Army, with a high profile of military
personnel and having an Army footprint instead of having a
civilian footprint?
Ambassador Satterfield. Congressman, around the world,
whether it is at a critical threat post or a different threat
level post, we try to make our protective details, our
presence, as low profile as possible consistent with the
protect mission, as unobtrusive as possible, and as consistent
with the civilian setting in which we operate as possible.
Mr. Shays. Thank you.
Chairman Waxman. The gentleman's time has expired.
Mr. Cooper.
Mr. Cooper. Thank you, Mr. Chairman.
I took my 88 year old mother to the movies the other day.
We saw a movie called No End In Sight. It is really more of a
documentary than a movie. In the middle of it, they say that
the following footage was filmed by a U.S. security contractor,
and he or she set the film footage to their own music. So it
sounds like MTV, driving rock music. But the video footage is
truly startling. It is shooting up cars, apparently on a street
in Baghdad, killing civilians, to this driving rock music.
Is the State Department aware of this film or have you made
inquiries as to which contractor, employee or independent
contractor shot this footage?
Ambassador Griffin. No, I am not familiar with the footage.
Mr. Cooper. And you are not familiar with the fact that it
is being shown all over America?
Ambassador Griffin. I am not familiar with the footage.
Mr. Cooper. Ambassador Satterfield, same answer?
Ambassador Satterfield. I am aware of that footage. It is
outrageous. The U.S. Government responded in just that fashion
at the time it was initially circulated, I believe that was
some years ago. It may be featured in a movie today, but the
film footage is not new. It does not reflect in any way the
standards of conduct that are prescribed by our regional
security office on the operation of any private security
contractor operating in Iraq, not today and not then.
Mr. Cooper. So you have not seen it, but you know it is not
true?
Ambassador Griffin. I have seen that footage.
Mr. Cooper. Mr. Ambassador, you say in your testimony, in
those rare instances when security contractors must use force,
management officials at the embassy conduct a thorough review
to ensure that proper procedures were followed. Ambassador
Negroponte has tried something similar just days ago. The
committee tried to find out about an incident that happened on
November 28, 2005. That is when a Blackwater convoy
deliberately smashed into 18 different cars en route to and
from the Ministry of Oil. Blackwater's own internal memo on the
incident said that Blackwater's tactical commander on that
mission ``gave clear direction to the primary driver to conduct
these acts of random negligence for no apparent reason.''
We have the Blackwater memo right here, the Blackwater
aviation team that was accompanying convoy pointed out the
problems. It also says that when Blackwater officials
responsible were questioned about this incident, they gave
statements, official statements, that your own employees said
were ``deemed to be invalid, inaccurate and at best dishonest
reporting.''
So we have a problem here, and the State Department
investigates problems. Well, when the committee asked the State
Department about this incident, we got no response. So we don't
know whether that means you investigated it and won't tell us,
or you didn't investigate it. Which is it?
Ambassador Griffin. There were a number of incidents that
the committee requested reports on 6 days ago. I regret that we
were unable to pull all those reports together in time for the
hearing. We will certainly provide those reports for the
record.
Mr. Cooper. We requested this in March of this year. So it
has been more like 6 months than 6 days. Are you saying that
Blackwater's recordkeeping is better than yours?
Ambassador Griffin. No, I am saying that there were a
number of other requests made 6 days ago, and I don't have
instant recall of all of them. But we will certainly get a
report to you about this particular incident.
Mr. Cooper. Another question. Blackwater testified they
hired away a number of military personnel. And Secretary Gates
is even worried about that, and has talked about non-compete
agreements. How many diplomatic security folks have they hired
away?
Ambassador Griffin. I am not aware that they have hired
any.
Mr. Cooper. Do you take that as an insult, they don't covet
your employees?
Ambassador Griffin. No.
Mr. Cooper. Do you take it as an insult that we have to
have extra help in so many places around the world, including
Haiti? Are you not training your folks up to that level?
Ambassador Griffin. I take it as an indicator of the
environment that we are operating in a number of posts around
the world.
Mr. Cooper. Have you requested the money or the training or
the resources to train your people up to the level that we need
them in Jerusalem and Port Au Prince and Kabul and Baghdad and
Basra and lots of places around the world?
Ambassador Griffin. My people have the training necessary
to work in those areas, and they are working there. But we
don't have the numbers of people that it would take to fully
staff all of those operations, and we don't have all of the
various areas of expertise, as I mentioned, such as helicopter
pilots and medics and armorers and mechanics, etc.
Mr. Cooper. Have you asked for the additional resources so
that you could augment your forces to meet the mission in those
areas?
Ambassador Griffin. We have requested additional resources.
But again, the question includes whether or not you hire a
full-time Government employee who is an employee for 25 or 30
years when the mission might only last 2 years. So certainly
there is a middle ground somewhere.
Mr. Cooper. So the State Department is saying we are
exiting from Iraq in 2 years?
Ambassador Griffin. No. I am just saying that we have
deployed in other places, going back to 1994. And certainly at
the beginning of a mission, it is hard to predict exactly how
long the operation will go on. But that we have operated in a
number of different countries using these protective security
specialists.
Chairman Waxman. The gentleman's time has expired.
Mr. Issa.
Mr. Issa. Thank you, Mr. Chairman.
I am going to continue along that line, because I think it
is a very good line of questioning, and I appreciate this part
of the hearing, because I think we are getting to some
fundamental questions about, what we are supposed to be
Oversight and Government Reform. And if at the end of this day
the oversight doesn't lead to constructive dialog on reform,
then we didn't do our job.
When we look at nominally 1,000 security people related to
the State Department, 800, almost 900 in Iraq, if,
hypothetically they all were standard pays and training that
you have somewhere else in the world, how often would you have
to be rotating these people in? This is assuming that every one
of those 900 or so positions were standard security within the
State Department security apparatus. What would that do to your
rotating into Iraq? How often would these people be going to
Iraq?
Ambassador Griffin. Presently, the rotation is 1 year.
Mr. Issa. No, no, that is not what I am saying. What is the
total number of Government employee RSOs and below that you
have at your disposal worldwide, not including contractors?
Ambassador Griffin. Our total staffing is roughly 1,450.
Mr. Issa. OK. So every year, almost, figuring schooling and
retirement, every year you would be rotating half your people
in. You have 1,400. If we added 1,000, then you would have
2,400 and you would need 1,000 of them in Afghanistan and Iraq,
is that right?
OK, so this is a surge of huge proportion, isn't that
right?
Ambassador Griffin. Yes, it is.
Mr. Issa. But let's go to a couple other areas.
Ambassador Satterfield, you and I have known each other for
a few years, because of my travels to Lebanon while you were
there. You have been a specialist in the Middle East. When you
were Ambassador in Lebanon, this is an area in which the State
Department contracts itself for its employees, is that correct?
Ambassador Satterfield. That is correct.
Mr. Issa. OK. At the time that you were Ambassador in
Lebanon, what was your amount of career foreign service
personnel that were security, your RSO and so on, versus the
contracted personnel that were mostly Lebanese?
Ambassador Satterfield. We had a team of approximately
eight RSOs. We had approximately 450 local guards who mainly
performed static guard duties of mission. We had a team of
about 75 bodyguards who had a specialty protective rule both at
the compound and more importantly, outside the compound.
Mr. Issa. And substantially, that is still what is going on
at Embassy Beirut?
Ambassador Satterfield. Those ratios have changed,
Congressman, in terms of the number of local guards, the number
of bodyguards and the number of RSOs. But the ratios in general
are similar.
Mr. Issa. So I am trying to understand, from a standpoint
of how you do business in a situation like Beirut, which since
1983 has been unique, you have refined it. But for all
practical purposes, what you do is you use your career State
Department people, many of them at the pinnacle of their
training and experience, to oversee essentially 75 mostly
national----
Ambassador Satterfield. All national.
Mr. Issa. All national trigger-pullers, to use a term that
has been used here today, and another 450 watchtower people.
And that is an efficient way to leverage your U.S. citizens
relative to the total exposure to the U.S. Government at
Embassy Beirut.
Ambassador Satterfield. In Beirut, we found it a highly
effective way to run the operation.
Mr. Issa. OK. So this is a model that would not be
unreasonable if we knew we were going to be doing the next 20
years in Iraq at this level? Is that true, Ambassador Griffin?
Ambassador Griffin. That is true. And the fact is that if
you look at all of our posts worldwide, we have in excess of
30,000 local guard force employees that secure our embassy and
consulate facilities overseas.
Mr. Issa. OK, so I am going to ask you the question, this
is the reform question, again. Do you have or are you working
out plans for areas like Haiti, Bosnia, Afghanistan and Iraq to
increase the number of direct contract personnel, particularly
indigenous, where appropriate, in order to both increase the
domestic participation and reduce the reliance on out of
country and comparatively expensive contract people?
Ambassador Griffin. I think Mr. Moser can talk about the
cycle for our contracts and the fact that they are of a short
term. We are always looking for ways to improve the way we do
business.
Mr. Issa. I understand that you can terminate Blackwater at
the end of a year, any time you want. But I guess the question,
because this is a committee that should be looking at the long-
term costs, and I share with the chairman the fact that we
shouldn't be spending $200,000 forever if we could be spending
in some cases a lesser amount and getting as good or better
service, whether or not that is a career foreign service person
or an indigenous person taking the place.
Mr. Moser. Mr. Issa, I have been in the Foreign Service for
a number of years, too, and I have actually been, visited or
actually served in a couple of posts in the Middle East. I
think my career colleagues in diplomatic security would agree
that our preference is to always use local personnel for these
services, if it is possible to do so. It is not in the State
Department's interest to have expatriate contractors for these
kinds of services. It is only something we do in the most
extreme circumstances. Just as you pointed out, and in Mr.
Satterfield's experience in Beirut, that is closer to our
traditional model.
Chairman Waxman. Thank you very much, Mr. Issa.
Mr. Issa. Thank you, Mr. Chairman.
Chairman Waxman. Mr. Lynch.
Mr. Lynch. Thank you, Mr. Chairman. I want to thank the
panelists for their testimony.
Ambassador Satterfield, in the testimony you prepared for
today's hearing, you wrote: ``In those rare instances when
security contractors must use force, management officials at
the embassy conduct a thorough review to ensure that proper
procedures were followed.'' I would like to ask you about the
investigation conducted by the State Department, and a couple
of incidents we have looked at. I might only get through one.
During our investigation, we found that on June 25, 2005, a
Blackwater operator shot and killed an innocent Iraqi bystander
in Al-Hillah. According to State Department e-mail, Blackwater
personnel failed to report the shooting, they covered it up,
and subsequently they were removed from Al-Hillah. The State
Department then in their e-mail asked Blackwater to pay $5,000
in compensation.
But we have no information showing that the State
Department ever conducted an investigation of that incident in
Al-Hillah. Could you tell me, was an investigation ever
conducted?
Ambassador Satterfield. Congressman, if you will, we will
get back to you with full details of that incident and the
investigatory followup.
Mr. Lynch. You are kidding. This is a June 25, 2005 case.
Ambassador Satterfield. Congressman, we will respond in
detail on the questions you have posed.
Mr. Lynch. But sir, you were the Deputy Chief of Mission at
the time. You don't recall this?
Chairman Waxman. Congressman, I do not recall in the
fashion necessary to respond to your question in the detail it
deserves.
Mr. Lynch. I am just asking if there was an investigation.
That is not, OK, you have the shooting, you were there, do you
remember if there was an investigation? That is not heavy on
detail?
Ambassador Satterfield. And Congressman, I would prefer to
respond to you in writing on this.
Mr. Lynch. Are you refusing to answer?
Ambassador Satterfield. No, Congressman, I want to give you
a full answer. I am not able to do that at this time.
Mr. Lynch. I am just looking for a yes or no. Was there an
investigation, yes, if there wasn't an investigation, no?
Ambassador Satterfield. I am not able to confirm the
details of what happened following that incident at the time.
Mr. Lynch. I am not looking for the details. I am just
looking for the fact of an investigation, did it occur or
didn't it occur?
Ambassador Satterfield. Congressman, I will have to check
on that for you.
Mr. Lynch. So you don't know, you don't remember if there
was an investigation?
Ambassador Satterfield. I cannot recall.
Mr. Lynch. OK.
Chairman Waxman. Will the gentleman yield to me?
Mr. Lynch. I will yield to the gentleman.
Chairman Waxman. The committee asked for investigative
reports and other documents relating to incidents involving
allegations of Blackwater's misconduct which would presumably
include shooting civilians and seeking to cover it up. But
virtually none were provided. That fact alone casts doubt on
the sufficiency of any State Department investigations into
these incidents.
We have had a better response from Blackwater than we have
from the State Department on getting information. Does that
bother you as much as it bothers me, or do you have to find out
whether you feel that way or not?
Ambassador Satterfield. No, Mr. Chairman. I----
Chairman Waxman. I can't understand why we don't get
responses from the State Department.
Ambassador Satterfield. We will be responding fully to all
of the requests made both at this hearing and by the committee.
Chairman Waxman. Well, some of these requests were made in
March, some were requested in June, we are already holding the
hearing. We made requests so that we could have them before the
hearing, not so that we could get them after the hearing.
I thank the gentleman for yielding.
Mr. Lynch. With all due respect, reclaiming my time, sir.
Look, what I am getting at is this. The State Department
works hand in hand with Blackwater, from my own experience in
Iraq, in a fairly coordinated team approach in protecting State
Department personnel. The closeness of that relationship
between State Department personnel, look, Blackwater is
protecting these folks every single day in a very hostile
environment. Friendships develop. Reliance develops. It is just
not possible, because of the conflict that is created, that the
folks that are being protected, State Department, are going to
do an objective job in reviewing the conduct of the people who
are protecting them.
And all I am suggesting is this, please, if you can answer
this question. Don't you think it might provide a little
separation and a more objective assessment of Blackwater's
conduct if we had a special inspector general reviewing those
incidents, so that there be a little space there, they wouldn't
be reviewing the conduct of people that protect them every day?
If you would take a crack at an answer on that one. Thank you.
Ambassador Satterfield. Congressman, we do take the issue
you raised very seriously, about distance, transparency,
objectivity of review of incidents, as well as objectivity of
review of rules of operation in general, conduct in general. We
are looking at that right now comprehensively.
But to go back to your original question, do we believe it
is possible to objectively oversee the operation of security
personnel in the field who protect us? Yes, we believe that is
possible. It is executed every day around the world. There are
dismissals from service made every day in response to
incidents. This is done.
But we are looking at the overall picture in Iraq right
now. And we will consider what steps may be appropriate.
Mr. Lynch. Here is my problem with that answer. The case
which I cited, there was a killing of an innocent Iraqi, the
RSO in question, I think, worked for you and Ambassador
Griffin. They were part of the review of the incident itself.
So just from an objective standpoint, looking at the whole
situation, there may have been some complicity or some
involvement, or, let's call it negligence even on the part of
that individual, and they are now reviewing the events in
question.
So that is all. I would just like some good, hard objective
review of the conduct here that would not be tainted by these
relationships. I yield back.
Chairman Waxman. Thank you. Blackwater and the private
contractors have to be responsive to you. But you have to be
responsive to us. We have the oversight jurisdiction and you
have the oversight jurisdiction over Blackwater. We want to
know if you are exercising that oversight responsibility.
Ms. Schakowsky.
Ms. Schakowsky. Thank you, Mr. Chairman.
I would think that the State Department is very concerned
on whether or not these private contractors, security
contractors, are actually helping us achieve our mission, that
is, whether they are helping to win hearts and minds or exactly
the opposite.
So what we are seeing is that this is a benign function,
all these various incidents. Are they making the job harder?
For example, after the Fallujah Four were humiliated and killed
in Fallujah, we had the Battle of Fallujah, where a number of
our forces who participated, a large number, were killed there.
The latest incident that we had has enraged the Iraqis, but
also shut down the Green Zone essentially, so that our
diplomats couldn't leave for a certain period of time.
I am just very concerned that all of these things have been
virtually ignored, and in fact, when it comes to Blackwater,
the position that seems to be taken with a number of different
quotes of e-mails and memos has been, let's just pay people off
and put this incident behind us. I could go back and quote all
these various things, but I think you have probably been here
and heard that.
I am concerned that you are allowing these private
contractors to hurt our mission in Iraq. And I would like a
comment.
Ambassador Griffin. If I may, David. Again, realizing the
environment that we are operating in in Iraq, just this
calendar year, Blackwater has been involved in 3,073 missions,
protective missions on behalf of the State Department. Let me
correct myself. There have been 3,073 country-wide missions by
the----
Ms. Schakowsky. I heard all that. That is the Blackwater
talking points. I have heard those.
Ambassador Griffin. This is a DS talking point. The reality
is, this year, there have been 6,000 attacks per month going on
in Iraq. That is the environment that they are trying to
perform the protective mission in, 6,000 attacks per month.
Ms. Schakowsky. And I am not questioning the level of
violence in Iraq. I am asking, and I will move on, I guess in
some ways I was commenting that these private security guards
who, we are unclear on what kind of oversight we can exert and
what you can exert, have been damaging our mission in Iraq.
So let me proceed to that. Under CPA, the Coalition
Provisional Authority Order 17, contractors have immunity from
the Iraq legal system. I heard you say, Ambassador Satterfield,
that you were going to review, this is 4 years later, the
effectiveness of CPA Order 17. Don't you think there is prima
facie evidence, since only two contractors that I know of have
been prosecuted in any way that we are insufficiently providing
oversight?
Ambassador Satterfield. Congresswoman, CPA Order 17----
Ms. Schakowsky. Deals with Iraqi law.
Ambassador Satterfield [continuing]. Which is part of Iraqi
law----
Ms. Schakowsky. Right.
Ambassador Satterfield [continuing]. Provides immunities
not just for security contractors, but for our armed forces in
Iraq, for diplomatic personnel of all diplomatic and consular
missions, not just that of the United States, in Iraq and for
contractors associated with them. It is a very broad mission.
Ms. Schakowsky. And does it still apply to everyone? They
are not subject to Iraqi law at all?
Ambassador Satterfield. CPA Order 17 provides immunities
for those classes of individuals, military and civilian,
diplomatic and non-diplomatic, operating in Iraq today. But the
question you raise, Congresswoman, is broader than the
operation of CPA Order 17, and we recognize that.
Ms. Schakowsky. Correct.
Ambassador Satterfield. It deals with issues of
jurisdiction and authority in U.S. domestic law, not just the
operation of a piece of Iraqi law that provides immunity to
Iraqi prosecution.
Ms. Schakowsky. Right. And so is it your position that a
Blackwater contractor working for the State Department can be
court martialed in the military justice system?
Ambassador Satterfield. The issue of jurisdiction and
operation of U.S. domestic law, the reach of U.S. domestic law,
over individuals who are covered by the operation of CPA Order
17----
Ms. Schakowsky. No, no----
Ambassador Satterfield [continuing]. In certain cases is a
question being examined now.
Ms. Schakowsky. So almost 5 years later, we are now
figuring out who is subject to what laws?
Ambassador Satterfield. This is a broader issue than Iraq,
CPA Order 17 or Blackwater. It is a global issue involving
jurisdiction.
Ms. Schakowsky. Do you think it is a problem that almost 5
years into, or 4\1/2\ years into the war, that only two of the
God knows how many people of the 160,000 we think are now
serving in terms of contractors have been formally charged with
anything and prosecuted? Don't you think that is prima facie
evidence that we are not doing enough?
Ambassador Satterfield. No, Congresswoman, because that
would require an examination of whether in fact there was a
body of individuals for whom there was reason to believe
prosecution should be made. And I am not able to comment on
that.
Ms. Schakowsky. So you would say that perhaps only two
people out of all those private contractors that have served
should be charged with anything?
Ambassador Satterfield. Congresswoman, I am not able to
comment on culpability under U.S. law, existing or----
Ms. Schakowsky. I am asking you to comment on whether our
oversight structure is sufficient if that has been the outcome.
Ambassador Satterfield. There are significant issues
involving the clarity and application of U.S. domestic law with
respect to certain classes of individuals who operate in
environments such as Iraq, but not exclusively in Iraq.
Chairman Waxman. The gentlelady's time has expired.
Mr. Cummings.
Mr. Cummings. Thank you, Mr. Chairman.
Gentlemen, first of all, thank you for being with us.
Blackwater has had enormous growth in the size of its Federal
contracts. Would you agree, Mr. Satterfield?
Ambassador Satterfield. [No audible response.]
Mr. Cummings. Mr. Moser.
Mr. Moser. I have been told that is true. I am really only
concerned with the growth of its size with regard to the State
Department. And that operation has grown some.
Mr. Cummings. In 2000, the company had less than $1 million
in Federal contracts, but since then, the company has received
over $1 billion in Federal contracts. I consider that
incredible growth for any company.
The first State Department contract that Blackwater got was
awarded in June 2004, is that correct?
Mr. Moser. Yes, that is correct.
Mr. Cummings. It was a contract to provide security
services to State Department officials in Iraq. And it was
worth over $300 million, is that correct?
Mr. Moser. Yes, that is correct.
Mr. Cummings. What bothers me is that this contract, and I
know you talked about this a little bit earlier, Mr. Moser, but
it was a no-bid contract.
Mr. Moser. Yes, it was a sole source award.
Mr. Cummings. And according to the Federal procurement data
base, the contract was awarded as a sole source contract
without any competition on the basis of urgency, is that
correct?
Mr. Moser. On the basis of urgent and compelling, because
we were transitioning from the Coalition Provisional Authority
to a State Department entity, that is correct.
Mr. Cummings. And how do we determine, let's say we have 12
companies that can do the same thing. Do you just pick up the
phone and say, hey, guys, I think we want to give you this $300
million contract? What do you do? All things being equal,
urgent situation, how do you determine? Because, let me tell
you something, if you choose Blackwater and I am Company X and
I can do the same thing, and you say, well, we gave it to
Blackwater because of urgency, I want to know, well, hey, why
wasn't I in the pool for the urgent group?
Mr. Moser. Mr. Cummings, that is a very, very good
question. As the head of the acquisition activity, we are
always concerned about promoting competition. This one was done
for urgent and compelling reasons. It is something the
acquisition activity does very reluctantly. At the time when
that was done, there was market research done. We examined the
capabilities of four other firms and made the determination
whether they could take on this task of providing these
services.
Realizing that we had done a sole source contract, we
worked with our partners in diplomatic security and awarded on
a competitive basis the worldwide protective services contract
iteration two in the next year, so that we only had a sole
source award for that 1 year for urgent and compelling reasons.
And as I said earlier in my remarks, because we were very
concerned about this contract, we asked for an independent cost
audit to be done on this. This is something we take very
seriously.
Mr. Cummings. Yes, you say the audit was done when?
Mr. Moser. The audit was done actually in January 2005. In
other words, of the current contract award. And we actually
negotiated down the cost of that contract by about $25 million.
Mr. Cummings. Let me make sure I am clear on this. Are you
trying to tell me that when you did this evaluation, you said
there were four other companies, are you trying to tell me that
those four other companies were not as qualified as this
company?
Mr. Moser. That is correct. Given the urgent and compelling
circumstances, we did not feel that they could meet the
Government's need at that time.
Mr. Cummings. And were there any other companies that you
considered outside now of the total of five? In other words,
you have Blackwater, who got the contract, $300 million, and
then we have four other companies that weren't apparently
qualified. I guess I am concerned about this qualified pool. I
hear people talk about pools and who is qualified. And I am
trying to figure out who is qualified and how are they
qualified, because I can, I mean, I can imagine there are a lot
of people that feel like they have not been treated right.
Mr. Moser. And I agree with that, Mr. Cummings, and that is
the reason why we use the authority within the Federal
Acquisition Regulations to use an urgent and compelling reason
to award a contract very sparingly. This is the reason why that
when we did this particular award, we had it reviewed by our
procurement executive to make sure, and by our competition
advocates, to make sure that we were not unjustifiably taking
this action. That is the reason why we were so anxious, 1 year
later, to award this competitively.
Mr. Cummings. It is my understanding that the previous year
they had a contract for $3 million and then, lo and behold, the
next year, $300 million. Boy, that sounds like the lottery.
Mr. Moser. I can understand that, too. But I really can't
speak about any contract that was awarded by the Coalition
Provisional Authority.
Mr. Cummings. But would you have looked at those contracts?
Would that have been a part of your consideration?
Mr. Moser. Yes. We would have actually examined those for
the past performance criteria.
Mr. Cummings. And who made the decision? Who made the final
decision to award it and who signed the contract?
Mr. Moser. I would have to look. I can't remember which one
of my contracting officer's staff actually signed it. I would
have to look at that contract. But that contracting action has
gone through and we have actually given those documents to the
committee. I see my colleagues on the staff, they have received
copies of those several times.
Chairman Waxman. Did that go any higher than just your
contracting officer? This is a pretty serious thing.
Mr. Moser. Yes, as I said, it was signed by the procurement
executive of the Department of State, which is not part of the
acquisition activity. He is an independent entity. It was also
signed by our acquisitions attorney to make sure that it had
full legal review.
Mr. Shays. Was this in 2004? Not 2007, not 2006?
Mr. Moser. This was in 2004.
Mr. Shays. It was in 2004 under Mr. Bremer?
Mr. Moser. No, actually 2004, as the embassy was stood up.
In other words, the 2003 award, I think it was 2003, and this
is where I am not really competent to speak, I think it was
made under Mr. Bremer. And I can't really speak to that. I can
only speak to the contracts the State Department has awarded.
Chairman Waxman. May I ask this question of maybe the
others, maybe Ambassador Satterfield or Ambassador Griffin
would know, maybe you know, you told us who signed it, but who
approved it? How high up did it go in the State Department for
approval? It is a large contract.
Mr. Moser. Oh, OK. The head of the acquisition activity
signed the sole source justification. That is the senior
executive service officer. It was reviewed by the Deputy
Assistant Secretary at the time who I replaced.
Chairman Waxman. Deputy Assistant Secretary?
Mr. Moser. Deputy Assistant Secretary, yes.
Chairman Waxman. Thank you.
Mr. Cummings. I just have one other question, very briefly.
Do you look at a company's capacity to perform a contract?
Mr. Moser. Yes, we do.
Mr. Cummings. And did you look at it in this instance?
Mr. Moser. Yes, we did.
Mr. Cummings. Did they have the resources to do this
contract at that time, or did they have to use the $300 million
to ramp up to doing it?
Mr. Moser. No, in fact, Congressman Cummings, we actually
always look at the capital requirements in the contract and
then look and see if the contractor, the offeror in this case,
because he is not really a contractor until he has gotten an
award, if the offeror has the financial capacity in order to
provide the resources that we are going to need.
And this is a typical, this is very much a business
analysis type decision. Because what we are looking to make
sure is that they are going to be depending on the next
paycheck to come so that they can actually keep on going. We
never want to put the U.S. Government at risk in that kind of
situation. Because in fact, our biggest criterion at the end of
the day is what risk is the Government at in terms of the
financial arrangements in the contract.
Chairman Waxman. Thank you very much.
In conclusion--yes?
Mr. Issa. We were going to alternate the time?
Chairman Waxman. We had Mr. Cummings take the questions. Do
you want to ask a question or two? Do you want a minute?
Mr. Issa. I do. My understanding, Mr. Chairman, was----
Mr. Shays. Take a minute. He's given you a minute. Just
take it.
Chairman Waxman. OK, your questions, in a minute.
Mr. Issa. I will be brief.
Chairman Waxman. The gentleman is granted a minute.
Mr. Issa. The recent report by Retired General Jim Jones
and Chief Ramsey appears to say in pretty much no uncertain
terms that there are roughly 300,000 police forces throughout
Iraq, 85 percent of whom are Shia, who are constituted in large
amounts by people who are not working in the best interests of
fairness and justice in Iraq, and that they have been so
infiltrated by people who will in fact kill Sunis and do other
things wrong that they should be, for all practical purposes,
torn down and started over again.
In that environment, and this is for Ambassador Griffin,
what does that mean to anyone, DS or contractor, trying to
protect your people when Iraqi police forces appear to be
coming on the scene?
Ambassador Griffin. As you can well imagine, it is an
extremely difficult task, as is, and if you are not sure if the
people who are supposed to be supporting your mission are
really with you or not, it only makes it more complicated. We
recently had an incident in Baghdad in September where one of
our convoys that was out to do an advance for a chief of
mission motorcade proceeded through an intersection where the
traffic was being held up by a police official in order to
clear the way for our motorcade which was promptly hit by an
EFP, an explosively formed penetrator.
Mr. Issa. The worst of all.
Ambassador Griffin. The worst of all. It resulted in three
injured Blackwater employees who had to be Medivaced to the
combat support hospital after the small arms fire ceased,
because it was a complex attack.
So it makes it extremely difficult. And it is part of this
environment that I alluded to where you have 6,000 attacks a
month and you don't always know who is with you and who is
against you.
Chairman Waxman. Thank you----
Mr. Issa. Final question----
Chairman Waxman. No, Mr. Issa----
Mr. Issa. Mr. Chairman, the rules of the committee----
Chairman Waxman. Your time has expired.
Mr. Issa. Mr. Chairman, are we going to have regular order?
Chairman Waxman. Mr. Shays is recognized for any closing
comment he wishes to make. Your time has expired. I am only
going by the rules.
Mr. Issa. Mr. Chairman--would you yield for a final
comment?
Mr. Shays. No.
Let me just thank you, Mr. Chairman, for holding this
hearing and making sure it didn't focus on an incident we do
not yet know the facts on. I want to thank our first panel and
also our second and say, as I wrestle with this issue, it seems
to me we are really debating whether, one, we want contractors
or we want the Army. Or a second issue is, do we want the State
Department to have its own protective force that would be paid
employees. I think these are all issues that are valid and we
need to have dialog on it.
I want to say to you again, Mr. Satterfield, when I have
been in Iraq, you have been at the forefront of tremendous
sacrifice for our country. Mr. Griffin, our paths didn't really
cross. But I just want to say to you, Mr. Satterfield, thank
you for your service in Iraq.
Again, Mr. Chairman, thank you.
Chairman Waxman. I just want to conclude by saying, it is
interesting how, at the end of the hearing, we come to the
recognition on both sides of the aisle that this is a valid
question and an important one, whether we should contract out
these kinds of services in Iraq or anywhere else. At the
beginning of this hearing, all we had from the other side of
the aisle were complaints that we shouldn't even be holding
this hearing.
Now, as far as the State Department is concerned, what we
have heard is that this was anticipated to be temporary. You
need to quickly put out a contract, because it was going to be
a temporary matter. Yet the embassy was being built for $600
million. This doesn't indicate to me that there was going to be
a temporary presence in Iraq. It indicates to me that we were
planning to be in Iraq and may still be planning to be in Iraq
for a very long period of time.
I can't understand why a security officer that is hired by
Blackwater should be paid two or three times what our commander
in Iraq is paid. It confuses me why we need Mr. Prince to
figure out to hire military veterans and give them the training
to do the job that the State Department could do with these
military personnel. I just think no one cared about the money
because Blackwater was organized and you just paid them an
aamount of money and they did the job.
From my point of view as a chairman of an oversight
committee, and I want to work together with Democrats and
Republicans, the taxpayers are not getting their money's worth,
by all the billions of dollars that have gone to Blackwater and
these other private security contractors, when it could have
been done a lot cheaper. And we are not getting our money's
worth, when we have so many complaints about innocent people
being shot, and it is unclear whether they are actually being
investigated by the State Department, because we haven't had
cooperation from the State Department to even tell us if
investigations have been done by them.
So if we are paying more and getting less than what we can
get from our military, I think that the American people are
entitled to ask why, and I still am not satisfied after this
whole long day of hearings, that I have had a good answer to
this question.
I thank the three of you very much for being here. We will
continue to be in touch with you, because we think you owe us
more answers and we are going to continue to ask the questions
until we get those answers.
The committee stands adjourned.
[Whereupon, at 3:39 p.m., the committee was adjourned.]
[The prepared statements of Hon. Diane E. Watson and Hon.
Bill Sali, and additional information submitted for the hearing
record follow:]
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