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Getting Our Money’s Worth in Iraq
Is contracting out services in Iraq really such a waste of tax dollars?
The AP reports that the Congressional Budget Office is worried about the cost of the war in Iraq; more specifically, they don’t think our government is getting a good deal for our money. They inform us:
Military contracts in the Iraq theater have cost taxpayers at least $85 billion, and when it comes to providing security, they might not be any cheaper than using military personnel, according to a report released Tuesday.
While much of the discussion (and the accompanying photos) in the article centers on security contractors, those who make it through to paragraph 12 will discover additional details:
The CBO estimated Tuesday that $6 billion to $10 billion has been spent on security work, and that the prices paid are comparable to a U.S. military unit doing that work.
Confused? Fortunately, one can find some clarity in the actual report:
- “Military contracts”: DoD’s piece is actually $76 billion (and of that “only” 54 billion is spent in Iraq); the Department of State and US Aid spend the remaining $9 billion. That figure may seem comparably small, but
- About 40 percent of DoS contractors in Iraq are security providers. So there’s another element of confusion in that opening paragraph — the total government expenditure is $6-10 billion, and a good number of those security folks are working for State.
- Why the ambiguous “$6 billion to $10 billion” range? Direct government spending on security contracts is “between $500 million and $1.2 billion annually” for a total of “between $3 billion and $4 billion” (a bit down from that $85 billion now, aren’t we?). But non-security contractors also sub contract for security, and acceding to the CBO report that represents the balance of their $6 to $10 billion estimate.
- Would it be cheaper just to have the Army provide the security? According to the CBO report — no. The perhaps widely held contrary belief is at least partly based on comparisons of the cost of a contractor to the pay of a low-ranking soldier. When one compares the costs of each, the results are similar:
CBO performed such an analysis, comparing the costs of a private security contractor with those of a military alternative. That analysis indicates that the costs of the private contractor did not differ greatly from the costs of having a comparable military unit performing similar functions.
And once the war is over, the report explains, the contract isn’t renewed, and the government is under no further obligation (continued employment, pension, VA benefits, etc.) to the contractor.
So now we know that according to the CBO report security contractors — about whom the Washington Post dedicated so much article space they ran out of room to tell us where our money is actually spent — make up a small percentage of the total contractors in Iraq and represent a savings of taxpayer dollars. (We could have saved much time if only the WaPo hadn’t been so confusing in that opening paragraph.)
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"Greyhawk" is a two-tour veteran of Iraq who blogs (since 2003) at the Mudville Gazette and MilBlogs. He created the MilBlogs Ring and MilBlogs TV.
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32 Comments
1. Outlaw13:They also seem to overlook the fact that having contractors there, means you have to use less soldiers to do those things. I remember when they replaced the Soldiers guarding the DFAC for contractors…it was a happy day for the crew chiefs and the junior officers who used to man those gates on what was supposed to be a day off from missions.
If the military had to do all the stuff contractors do…a lot of it wouldn’t get done. Just because a lot of it would be written off as not being worth the trouble. Contractors on the battlefield is a fact of life now. The Army is not structured anymore to do a lot of things contractors do. So in a lot of ways this report is more of a waste of money than the contractors they are talking about.
Aug 15, 2008 - 6:58 am 2. Dadmanly:Excellent analysis, GH. Brought me right back to the FOB in detail and environmentals, as well.
Critics can argue all day long about whether all of these contracted services are “worth it.” Maybe we could do without the creature comforts. Maybe we can go without the US-style food, the air, the laundry, the plumbing, the recreational options, the products and services that the modern military takes for granted. But most of our men and women would suffer their loss, because organic military units can’t make up the absence. Soldiers — right or wrong — want a better standard of living for their down times (when they’re not shooting or manning a position or providing convoy escort. If they don’t see it, they quit the all volunteer force.
For sure, if we didn’t use the military, tried diplomacy only foreign relations, it wouldn’t matter that nobody would want to serve. Our Army could be the size of Georgia’s.
Many of the critics in media and on the Left think that would give us a peace dividend, that’s what they thought with Carter and Clinton, and hope too with Obama.
Speaking of Georgia, we can all sit back and watch that other “peace dividend” play out under the treads of Russian tanks.
Aug 15, 2008 - 7:07 am 3. David M:The Thunder Run has linked to this post in the blog post From the Front: 08/15/2008 News and Personal dispatches from the front and the home front.
Aug 15, 2008 - 8:28 am 4. Greyhawk:I should add – for the benefit of those who haven’t been there, that the facilities (latrines, laundry, gyms, barber shops, etc) are cheap pre-fabs, trailers, tents or (occasionally) existing structures modified for the purpose with plywood and two-by-fours. I sometimes forget that the mental image created by the use of words like “gym” or “internet cafe” can be far from reality.
Thos who argue that GIs in Iraq (specificaly in FOBs) are living in the lap of undeserved or unearned luxury would probably prefer to let that erroneous mental image stand. Such comforts are indeed unprecedented, but as – Dadmanly points out – their positive impact on morale makes their value far beyond their cost. (Same applies to Outlaw13’s point regarding ’security contractors’ at the DFAC door.)
Old school Joes might decry the loss of the “character building” potato-peeling details from the Beetle Baily days – but sharp, modern NCOs find ways to fill that need, too…
Aug 15, 2008 - 8:55 am 5. Keith_Indy:Thanks, very informative analysis. The first hand anecdote really serves well to show by example where contractors are being used. Also from the example I can see a wide range of what is termed a “security” contractor. So, not all of them are the Blackwater shooting wildly out of blacked out SUV’s. Good piece of info to know.
Thanks for your service. Stay safe.
Highest regards…
Aug 15, 2008 - 11:51 am 6. Brian H:The implicit point here needs to be made explicit: just where the F*** do the critics of contracting think all the military to fill all those menial and specialist jobs would come from? Additional recruiting? Off the line? Redeployed from Pentagon desks? Dream on.
I regard the contractors as Force Multipliers. The warfighters and COIN “strategic corporals” get to do what they’re good at and paid for, rather than running laundries and driving trucks and pulling security details on dining halls, etc.
The accountability guidelines for contractors should be reduced to a single line: “Don’t do anything to screw up the military’s mission and efforts.”
Aug 15, 2008 - 3:03 pm 7. Cannoneer No. 4:Having an air conditioned hooch to sleep in, a shower, a flush toilet, email back to Mama, good chow, and recreational opportunities to forget where you are and what you’ll be doing in 12 hours helps to mitigate the PTSD.
The people out on the COPS and JSS suffer in comparison.
Just off the top of my head I recall dealing with Indian, Filipino, Ugandan, Sri Lankan, Pakistani, Somali, Kryghiz, Lebanese, Turkish, Hungarian, Bosnian, Gurkha, Nepalese, Djiboutians and Macedonian Kosovars. They work hard performing Combat Service Support that used to be done by the Theater Army Area Commands we did away with 15 years ago.
Aug 15, 2008 - 5:03 pm 8. Letalis Maximus, Esq.:Here’s the bottom line – the government pays a contractor’s company for the job done and that is it. No federal employees. No federal employee unions. No benefits. No VA services to worry about. No survivor’s benefits. It may not be cheaper in the short run, and it may not even be cheaper in the long run. But it is easier for the Congress to have it done this way and we all know that is what really counts.
Aug 15, 2008 - 7:37 pm 9. Skyler:An important point being missed here is that it’s very, very difficult to expand the size of the military to do these jobs. Every person in uniform doing these things is not carrying a rifle and fighting. Congress controls the number of people in uniform, but service chiefs, so long as they have a budget, can easily grant contracts for just about anything.
So using contractors is driven by a need to have more trigger pullers without trying to enact new laws. If you can take the 150 techs that are used to fix airplanes, contract out much of their work, you can use that head count to make infantrymen.
Aug 15, 2008 - 7:42 pm 10. SFC SKI:Don’t forget, a lot of your terps are contracted linguists, both native speakers and DLI-trained former military linguists. Until we occupy an English speaking country ( I vote for the bahamas), we’ll always need translators.
Aug 15, 2008 - 7:47 pm 11. ZEITGEIST:[...] GETTING OUR MONEY’S WORTH, in Iraq. [...]
Aug 15, 2008 - 7:49 pm 12. Eric:Outlaw13 and Brian H get at the key to the situation — end-strength, the number of people authorized by Congress to be in the military at the end of the fiscal year, is a finite number, and limited at that. Just replacing the security contractors with similarly qualified military guys would mean longer tours/more rotations for the military guys, and it would drain off guys doing actual COIN and training missions like hunting down bad guys and showing Iraqi troops how it’s done. Trying to replace all or part of the rest of the contracted logistical tail would make the problem catastrophically worse.
Aug 15, 2008 - 7:58 pm 13. ThomasB.:I don’t get this? First the liberals say that we should pay reparations in the tune of billions of dollars to the Iraqis, then say when the country is stabilized due to the US effort, we are not getting our money’s worth? I don’t understand democratic foreign policy.
Aug 15, 2008 - 8:31 pm 14. Kevin R.C. O'Brien:To amplify Skyler’s point:
Today, with a war on, your young soldier or Marine joined up to get into the war, not to be a KP or a truck jockey. Revert to the penny-wise personnel policies of the dreadful draft days, and GAO will run out of toner printing reports about waste, reports that will reach Russian-novel dimensions.
On the other hand, better to be in the FOB wishing you were in combat than in combat wishing you were back in the FOB. Funny how that works. But still, our young troopies joined to serve and to fight. We ought to respect that.
Aug 15, 2008 - 8:44 pm 15. Getting Our Money’s Worth « Buttle’s World:[...] Getting Our Money’s Worth Filed under: Posts — buttle @ 20:08 In Iraq. [...]
Aug 15, 2008 - 9:08 pm 16. bc:If you think winning wars is expensive, try losing one, especially in the Middle East.
Aug 15, 2008 - 9:25 pm 17. Jim:I spent 2004 in Baghdad and was in the Red Zone 3 days a week. I was more confident when I was transported and guarded by Blackwater than by my occasional Army escorts. The Blackwater guards were less tense, more alert, communicated as a team, and didn’t point their weapons at Iraqis in traffic. Worth every penny.
Aug 15, 2008 - 10:21 pm 18. BenJCarter:The diversity of contractors seems remarkable.
Aug 15, 2008 - 11:55 pm 19. CPT M:Thanks Greyhawk,
Aug 16, 2008 - 12:34 am 20. Sandra M:I just had a KBR contractor clean my AC and change the filter this morning. While I was in the shower trailer, a contractor came in and started to clean. I have already interacted with about 15 contractors this morning. Frees me up for the 7 hour patrol I have later. I am sure glad my guys don’t have to guard the FOB when they are done with their patrols. Great article.
The head of Blackwater greatly impressed me when after an appearance on Charlie Rose, he spoke of what company like his could have done to protect civilians from marauding thugs in Rwanda during the atrocities. That moment stayed with me because I wanted to hear more.
There are countries where we have no “strategic interests”. Teams from Blackwater could do an incredible job in protecting civilians from armed but undisciplined mobs.
The mob violence Obama’s cousin Raila Odinga engaged in in Kenya after losing the election (Obama campaigned for him, Google it.) could have been nipped in the bud by a group like Blackwater.
Aug 16, 2008 - 4:04 am 21. Getting Our Money’s Worth in Iraq « Gathering of Eagles: NY:[...] For the rest of his cogent analysis and masterful takedown of the medias claim go here. No Comments Leave a Commenttrackback addressYou must log in to post a comment. [...]
Aug 16, 2008 - 4:39 am 22. SDN:The AP reported this in such a way as to make our military look bad. I’m shocked, simply shocked….NOT!
Aug 16, 2008 - 5:03 am 23. Moultrie:Great post, Greyhawk and Sandra M’s reference to Rwanda & Kenya is spot-on:
Aug 16, 2008 - 6:40 am 24. Tim:‘The mob violence Obama’s cousin Raila Odinga engaged in in Kenya after losing the election (Obama campaigned for him, Google it.) could have been nipped in the bud by a group like Blackwater’
Thanks for the post, what impressed this ex contractor was that so many of the trucks, driven by contractors, continued to make the runs from Kuwait up to where ever they went and did so unarmored, turn around, shuffle and repeat.
Aug 16, 2008 - 7:57 am 25. ajacksonian:By-the-by your phone call was most likely possible due to … contractors.
Regards
The change that started in the 1990’s was in logistics with DLA – much of that went contract, as well as taking lessons learned from FedEx and UPS on package movement and delivery. This is one of the few conflicts I can remember where the actual ‘boots on the ground’ get what they need so long as it is in stock in the system. When materials ran out it was not due to having them and not transporting them, like body armor or Humvee armor: the stuff hadn’t been made to be in the system. I am hard pressed to remember a side that is not badly losing a conflict actually not making things fast enough to keep them in the supply chain. There were major hiccups in the system, but that was due to poor forecasting of need and getting spares. Congress always skimps there, first.
Coming from the civil side, the contractors usually start out with a contingent of ex-government employees who used to do the job being contrated out. Generally, and there are exceptions, they get paid better, have better retirement benefits and enjoy their work. The downside is that when a contract goes under, that skill base disappears, although the new contractor often starts to pick up the personnel to do the job. In some areas that works very well on the civilian side, like grounds, building maintenance, and the such. Many government workers pick up ‘off hour’ second jobs doing that due to clearances. As you head up beyond basic IT and get to specific technical needs, the ability of contractors to perform at or below par cost diminishes: those specific skills aren’t cheap to get. And even if you have a contractor, someone has to sign-off on the work, which means that personnel get put on that work on the government side.
In the field and in theater, there is no replacement for contractors and working that system into shape means that those who are in the armed forces get to do the actual pointy-end job. We are long past the ‘lowest cost always wins’ and ‘best value for the money’ means improved services at lower cost. By being willing to pay more up-front, better services and lower overall total cost is the result, and that matters.
Aug 16, 2008 - 8:49 am 26. Subsunk:DadManly, GreyHawk and the rest of you folks here do a much better job of explaining how things in the world actually work, then anyone in today’s media. I am constantly amazed by how much better the information is and always has been from Mudville, DadManly, BlackFive, and the rest of the MilBlogs.
Good job, GreyHawk. As always, I’m proud of you. And I know my contractor buddies agree with all the points you’ve made here. Just because it is expensive to perform these services in a combat zone, doesn’t mean they shouldn’t be done. Let Nancy Pelosi and Harry Reid try running Congress without assistants and administrative staff to make their jobs easier.
Subsunk
Aug 16, 2008 - 10:55 am 27. Jessica:Please give some kudos to the Government Contract Specialists and Contracting Officers who award and administer these thousands of supply, service, contingency and construction contracts. For every contract, we work our behinds off ’til late hours on weekdays and on weekends if necessary, to get solicitations out specifying what the military urgently needs; fairly and properly evaluate prospective contractors’ price and technical proposals in accordance with a whole slew of regulations and policies; justify in lengthy, narrative writing who we’re awarding to and why it’s in the Govt’s best interest to award to that company; then, administer the contract through its end by monitoring the contractor’s performance and ensuring that all contract requirements are completed satisfactorily. The contractors get praise for their work, but the Government civilian contracting professionals who award and manage those contracts rarely get any kind of recognition.
Aug 17, 2008 - 12:03 am 28. CPTKevin:I think you have missed why this is so much news to the average person in the States. For years we had to listen to how we have “more than enough” soldiers to do the mission. In fact, I remember with you and with Dadmanly discussing this issue. You guys used to tell me I was being unpatriotic and I didn’t know what I was talking about when I would bring up the fact that Rumsfeld didn’t know what the heck he was doing and there should have been a lot more troops there.
Now, of course the right wing Milbloggers have rewritten history and are basically stating that the “surge” was a brilliant idea brought up by brilliant military strategists. But we know it was simply what many of us said since day one.
So, why is the use of contractors so big? Well, first, it supports the position many of us have held which is our Military is far too small for our current foreign policy.
Second, it means our military is DEPENDENT on outside contractors, many who are employing third world labor (not even US Labor), to do anything in the world. You can argue whose fault it is or whether if it is the military too small or the foreign policy too broad, but the fact is we are an impotent Country with an impotent Military right now. Why does Russia role into Georgia and threaten Poland with nuclear weapons? Because we are impotent to fight for what really matters thanks to George Bush’s policies.
Finally, I think you will find the “news” is not that we have Indians serving you food but that we have contractors carrying guns, providing security, engaging “enemy” forces etc. etc.
We used to call that a Mercenary Army.
Aug 17, 2008 - 2:44 am 29. djaces:Regarding the cost of the war in Iraq, I see Obama has an ad out decrying the billions in oil revenue the Iraqis have accrued since the war began. I find it greatly ironic that a man who’s followers have been railing for years that we went to Iraq to steal their oil should be implicitly claiming that we really should now be stealing their oil revenues.
Aug 17, 2008 - 12:44 pm 30. James:No comment of the Ugandan security contractor who shot his South African supervisor in the back (Jan. ‘08)? No comment on the contractors who were unqualified to do the job they hired on for? No comment on the number of SUV’s being used as personal vehicles by the military and contractors? No comment on racial strife at Victory Base Complex?
I must have been in a different Iraq.
Aug 17, 2008 - 5:04 pm 31. greyhawk:James,
Given an opportunity to comment on anything you wanted you chose to complain that other people hadn’t commented on the topics you wanted them to. An odd choice, but it was yours.
I won’t complain, but will say that’s unfortunate – from the vague hints you left you actually had something worthwhile to contribute to the discussion – knowledge that others lack.
Aug 20, 2008 - 2:22 pm 32. VJ Roads:Yeah James I may be in Camp Spiecher in approx a month, so tell me what where your biggest complaints.
Aug 21, 2008 - 11:09 am