Private Warriors
Produced by Marcela Gaviria and Martin Smith
Written by Martin Smith

ANNOUNCER: Over the last two years, America has poured billions of dollars into Iraq. Much of it goes to private contractors. The biggest boom has happened in the security industry.

Col. THOMAS X. HAMMES, U.S. Marines (Ret.): Anybody who can start a company is piling into the country. There were security contractors over there that were just cowboys.

SECURITY BRIEFER: —suicide bomber moved in alongside the vehicle and detonated—

LAWRENCE PETER, Private Security Assn., Iraq: The demand for private security company effort was so great in Iraq that there was no competition. If you wanted a contract, you were going to get a contract.

ANNOUNCER: It's a lucrative but deadly business. Tonight on FRONTLINE, correspondent Martin Smith travels to Iraq to see the private side of war.

MARTIN SMITH, FRONTLINE Correspondent: [voice-over] There are tens of thousands of private contractors living and working in Iraq. Many of their companies are headquartered here, in Baghdad's Green Zone. This used to be the seat of Saddam's power, four square miles of palaces, villas and monuments along the Tigris River. Today, the Green Zone is the heart of occupied Iraq. Ensconced in cement, it feels like a surreal fortress, with armed guards everywhere.

The Rashid Hotel, once Iraq's finest, is now practically empty. The Tomb of the Unknown Soldier is a tourist attraction without tourists. And the parade grounds where Saddam once reviewed his troops is now used by private security guards to practice driving under fire.

Though this is my fourth trip since the war began, this is the first time I've felt it's unsafe to travel about freely. I took a tour of the Green Zone with Lieutenant Colonel Bill Foos.

Lt. Col. BILL FOOS: It's not called the Green Zone, it's called the International Zone. People that have been here for awhile, they've stopped referring to it as the Green Zone because it's not the Green Zone. Green connotes safety, security.

MARTIN SMITH: Foos is a reservist with the Army Corps of Engineers. He is taking us to see what he calls their SUV graveyard. The Army Corps takes great risks in traveling about Iraq, trying to rebuild the country's infrastructure. These are some of the vehicles they've lost to insurgent attacks.

Lt. Col. BILL FOOS: This was in a VBIED attack. That's shrapnel from the explosion.

MARTIN SMITH: What's a little surprising is that the Army Corps doesn't rely on soldiers for protection. They've outsourced the job. The security company the Army Corps hired is not even American. The company, Erinys, was founded by ex-members of British special forces and hires an assortment of ex-soldiers and retired policemen from South Africa, America, England and Russia. The name Erinys refers to the Greek goddesses who pursue and punish evil.

Before getting in the vehicles, producer Marcela Gaviria and I are given a briefing

[on camera] Martin Smith.

JOEY JORDAN, Erinys Iraq: Blood type?

MARTIN SMITH: O-positive.

[voice-over] One of the greatest dangers Westerners face in Iraq is traveling.

JOEY JORDAN: OK, now, first thing, introduce myself. My name's Joey Jordan. I'm Team 2 CRG of GRD Team 3.

MARTIN SMITH: Most security contractors are in their 30s or 40s, but Joey here is a 23-year-old from England.

JOEY JORDAN: Safety— seatbelts, body armor and Kevlar will be worn in the vehicles at all times. GRD Team 3 is the most aggressive and well-trained team on the GRD contract, OK? The front vehicle, which is a silver Excursion over there— you may see this vehicle push other vehicles off the road, OK? If a vehicle gets in front of us, tries to slow us down, we'll give him a warning. If he doesn't adhere to that warning, we're going to hit him, get him out of the way and then get you down to your destination as fast as possible. Stay in the vehicle until myself or Mike tells you otherwise. We will tell you when and where to go at all times, OK? Everybody happy?

MARTIN SMITH: We set out in three cars. We ride in the middle, or client, car.

JOEY JORDAN: OK, all clear.

MARTIN SMITH: Just outside the gates of the Green Zone, we accelerate.

JOEY JORDAN: Increasing speed. Let's get out of here, gents.

MARTIN SMITH: The ride is jarring and nerve-wracking. As we proceed, the front and rear cars maneuver to shield us from any perceived threat. The sirens warn Iraqi drivers to steer clear.

JOEY JORDAN: Breaking, breaking, breaking!

MARTIN SMITH: If they don't, they can be forcibly cut off.

JOEY JORDAN: All vehicles follow me. Increasing speed. Let's go.

MARTIN SMITH: Our driver, Jason, is from Florida. He first came here as a U.S. soldier in 2003. After a few impossible twists and turns, we arrive at Erinys headquarters.

JOEY JORDAN: Ladies and gentlemen, thank you very much for an excellent day.

[www.pbs.org: More about the making of this film]

MARTIN SMITH: I'm not looking forward to the return trip.

[on camera] In a briefing, I noticed, before getting into the car, I'm told that the driving is going to be aggressive.

ANDY MELVILLE, Project Director, Erinys Iraq: Perhaps it's not the best use of terminology. The driving has to take that posture when the risk threat is high, and we do change our driving stance to meet the threat. As I said to you, the risk threat is high. You said yourself that you're aware of the suicide bombings that blew up security teams just yesterday. And we're very, very cautious of civilian vehicles approaching our motorcades.

MARTIN SMITH: Why does the U.S. Army Corps of Engineers need you? Why not just use U.S. soldiers?

ANDY MELVILLE: I can't comment on American policy, but clearly, they feel they require the services of a professional private security company. What I will allude to is the fact that the Americans would like to withdraw troop members. And perhaps it is part of their policy to reduce troop members and replace them with private security contractors.

MARTIN SMITH: [voice-over] Security work is big business. Erinys has grossed more than $150 million in Iraq. Worldwide, they've had contracts to protect USAID, Fluor, Siemens, British Petroleum and the BBC.

ERINYS GUARD: Vehicle down! Vehicle down! Vehicle down! Vehicle two is down!

MARTIN SMITH: They say they have never lost a client, but three Erinys guards have died on their Army Corps contract, a contract worth $50 million. Another 16 Erinys guards were killed protecting Iraq's oil infrastructure. They said they've killed around 70 insurgents.

ANDY MELVILLE: Unfortunately, they attack us fairly regularly. It's truthful to say that we're attacked probably once or twice a week at the current time, throughout operations through the whole of Iraq. We've got 15 security escort teams across the whole of the country. And it is very distressing that the Iraqis choose to attack us, and typically once or twice a week.

MARTIN SMITH: [on camera] Do those incidents result in the deaths of Iraqis?

ANDY MELVILLE: Unfortunately, we have had to kill anti-Iraqi forces in the pursuance of our duties, which is to protect the lives of our client.

MARTIN SMITH: Who are you accountable to in Iraq?

ANDY MELVILLE: We're accountable to the coalition forces. And we're a very, very professional and disciplined company.

MARTIN SMITH: [voice-over] On occasion, Erinys has recorded insurgent attacks using a camera mounted on the dashboard. Watch the next parked car on the right. The security detail immediately opens fire. The driver has been knocked unconscious. Then the dashboard camera is turned off. About 20 minutes later, the guards, unharmed, have secured the area. They report that one Iraqi was killed.

ANDY MELVILLE: We are only equipped to carry out defensive operations. We don't have any offensive capability at all. Essentially, we are a taxi service, and we're equipped to defend ourselves if we're attacked. Our entire doctrine, all of our policies and standard operating procedures, all revolve around getting out and getting away from the area of threat, getting out of the contact area.

[www.pbs.org: Read the extended interview]

MARTIN SMITH: The situation on the roads remains chaotic. Laws are only just being written.

The prime motive for joining a private security company is money. Guards can typically make from $400 to $600 a day, many times what a soldier makes. This is Blackwater, a high-profile American company that guarded U.S. ambassador Paul Bremer and still guards State Department personnel in Iraq. The company's guards are paid up to $1,000 a day. It causes some resentment among soldiers.

Blackwater made headlines last year when four of its contractors were killed in Fallujah. Their deaths drew attention to the high-risk contracting business and the people it attracts.

By all accounts, Scott Helvenston, who joined Blackwater in March of 2004, was well prepared for security work. He had been a Navy SEAL instructor and was a world-class athlete. He had earned the nickname "Scotty Bod." But Helvenston had fallen on hard times. He was in debt. He and his wife, Trisha, were just eking by, selling a line of exercise videos.

JAY PRICE, Raleigh News & Observer: Scotty had mainly financial problems. His video business was failing financially. He's got two kids he's got to provide for. And at one point, they were living in a small trailer on a campground, and you know, Mr. SEAL, Mr. Scotty Bod, is essentially a security guard in the campground. That couldn't have gone over well.

ED TWYFORD, Friend: I mean, that was a big impetus for him to go, from a financial standpoint. I mean, he told me one time, "If I can go over there and get a chance to make a name for myself, it'll be high-profile position, I'll be standing right in front of Paul Bremer for 60 days. And also, the financial rewards. Just think what I can provide for my kids." You know, he never said, "Hey, when I come back, I'm going to buy a new Suburban." You know, that wasn't the deal.

KATY HELVENSTON, Mother: He was going to be back home in two months. He didn't want to leave his kids. And so he said, "OK, Mom, I'm going to go over there for two months. I can make some good money." And that was the deciding factor. When you've been in Special Forces for 13, 14 years, you're trained to do one thing, and there's not a whole lot of jobs out there for people trained to kill. There really aren't. What are you going to do?

MARTIN SMITH: Helvenston was sent to the Green Zone in Baghdad. But from the start, things didn't go as he had hoped. He never met Bremer. Blackwater had a new contract with a catering company called ESS, and they were scrambling to find new guards.

JOE NEFF, Raleigh News & Observer: So they're just pulling this team together to work on this contract. Meanwhile, things were heating up in Iraq.

JAY PRICE: They certainly knew that there were risks involved in this, but they were go-getters. They were the kind of guys who accomplish missions, they're weren't guys who turned down missions and walked away.

MARTIN SMITH: But the men were uneasy. One team member, former Army Ranger Wes Batalona, complained to a friend that the team had never worked together before.

HAROLD VIDINHA, Security Contractor: Wes was very upset because you're breaking your team, and you're putting people— different people together. That's what's very upsetting. And then you are sending them in undermanned.

MARTIN SMITH: Contractually, Blackwater was to supply two SUVs with three guards per vehicle. Instead, the men set out at 8:30 in the morning with just two men per car, each short a rear gunner. They were escorting three empty trucks on their way to pick up some kitchen equipment at a base west of Fallujah. They were vulnerable— and obvious.

The commander responsible for Fallujah was Marine Colonel John Toolan.

Col. JOHN A. TOOLAN, U.S. Marines: Contractors were easily identified on the roads because they were all in brand-new SUVs— 2004 SUV, tinted windows. So they were easy to pick out. And the insurgents knew that it was a fairly easy mark.

MARTIN SMITH: Around 9:30 AM, they approached the center of town. Insurgents would ambush them from behind. All four guards were shot and killed. The insurgents made their own video of the aftermath.

HAROLD VIDINHA: The first thing that came up was a camera bouncing toward this SUV, and it went right into the car. There he was. I mean, that's— I knew it was him from his looks, everything. I mean, clear as day. You know, at least I know he wasn't burned alive. He was dead.

MARTIN SMITH: By the time the press arrived, a mob had set the cars on fire.

Col. JOHN A. TOOLAN: Unfortunately, it was going out on CNN. And we knew that this was a key component of the insurgent strategy: Get the pictures out, make it look like they're winning. It was clear.

MARTIN SMITH: Victim Jerry Zovko's family was hearing the news back in the U.S.

DONNA ZOVKO, Jerry Zovko's Mother: I was at my desk, and you know, there's the radio going on, saying that there has been four men killed in Fallujah, that they were dragged through the streets and they were burned and they were hung.

TOM ZOVKO, Jerry Zovko's Brother: There it was. The headlines hit too close to home, you know?

ED TWYFORD, Scott Helvenston's Friend: You know, I was, like, "Man, where do I go from here?" You know, "What am I supposed to do?" You know? What do you do when your best friend dies? So I immediately thought of his kids. You know, I'm going to call up Trisha. Daggummit!

KATY HELVENSTON, Scott Helvenston's Mother: They were sent into an area none of them had been to. They took out their rear gunners. They didn't have— they didn't have their armored vehicle, didn't have a map, nothing.

MARTIN SMITH: Four days later, Colonel Toolan was ordered to invade the city and find the killers. This was not his original plan for quelling hostility in Fallujah.

Col. JOHN A. TOOLAN: We had developed a pretty detailed plan on how we were going to address the problem, to the point where they understand the importance of rebuilding, reconstruction, working with the people, earning trust. And by those contractors being killed, it really forced us to put that aside and to opt for the more direct approach.

JOE NEFF: They have no control over these contractors. They go into Fallujah, they get killed, and it tosses the Marines' best-laid plans out the window.

Col. JOHN A. TOOLAN: And now we were going in as their worst enemy, and it's tough to come back from that. Certainly, the next time I'm sent some place with the Marines, the amount of control that I need to establish up front is going to be clear and more restrictive.

MARTIN SMITH: The incident created animosity towards contractors that continues today.

PETER SINGER, Brookings Institution: There's a bubbling resentment, and you're starting to sense a backlash from the military.

MARTIN SMITH: Peter Singer is author of Corporate Warriors, a study of the private security industry.

PETER SINGER: And what's happening now within the military is they're putting together an entire new doctrine, entire new package of rules and regulations as to how contractors are supposed to be used. Contractors should not be in essential roles. Contractors should not be armed. The problem is that that's slapping in the face of the reality of how they're being used.

STEVEN L. SCHOONER, George Washington University: We have tens of thousands of armed contractors in Iraq defending the Green Zone, defending military, defending contractors in and around the area, but they're not part of the military command structure.

MARTIN SMITH: Professor Steven Schooner is an expert on military contracting.

STEVEN SCHOONER: They don't communicate in the same networks. They don't get the same intelligence information. And so when things begin to develop quickly, there's an awful lot of people around with weapons who have important tactical responsibilities, who don't have the same information and aren't getting the same messages from the tactical leadership.

MARTIN SMITH: Reform has been put on hold. Private security guards are a fact of life here. Coalition authorities have tried to improve coordination between security contractors and the military, but ironically, they turned to the private sector for help.

PETER SINGER: We developed the classic Kafkaesque solution, which is we have a problem of outsourcing and coordinating outsourcing, and that we've done too much outsourcing and we don't have a control over it. So what would be the solution to it? Let's outsource the solution.

AEGIS SECURITY BRIEFING: Of reported attacks, IEDs featured strongly, with a relative increase in the use of IDF in Baghdad and in northern Iraq.

MARTIN SMITH: A British security company, Aegis, was hired for $300 million to help coordinate and track all security teams operating in Iraq, as well as to protect the Green Zone.

AEGIS SECURITY BRIEFING: —was assassinated in a drive-by yesterday—

MARTIN SMITH: Every morning at their command center, called the ROC, they brief other security company representatives.

AEGIS SECURITY BRIEFING: We had a three-vehicle PSD—

MARTIN SMITH: The problem is that participation is voluntary.

AEGIS SECURITY BRIEFING: —at which point, the suicide bomber moved in down the slip road alongside the vehicle and detonated.

MARTIN SMITH: And even companies that participate are still outside the military chain of command.

AEGIS SECURITY BRIEFING: Seven IED attacks around the city, also a few mortar attacks.

MARTIN SMITH: Most reps we spoke to said the ROC has failed to establish order in the industry.

AEGIS SECURITY BRIEFING: All right. Thank you for being here today. And as always, be safe, but if necessary, be lethal. Have a great day.

MARTIN SMITH: Several military officers we spoke to complained that there are contractors that simply shouldn't be here. Marine Colonel Thomas X. Hammes was a base commander in Iraq in early 2004.

Col. THOMAS X. HAMMES, U.S. Marines (Ret.): There were security contractors over there that were just cowboys. They clearly had neither the training nor the experience. Could I identify them? No. They wore a mixed bag of uniforms. Nobody wore nametags. They didn't have unit logos.

You'd run into these people in town with really kind of a bad attitude, and there was nothing you could do about it. How do you identify them? Well, there's no licenses plates on their car. They're driving an SUV. These people were simply unsafe.

Whether you like it or not, they represent you. To the local population, they're your hired guns. The Iraqis resent it very much and knew quite clearly that if one of these people shot an Iraqi, they were not subject to any law. They could simply be extracted from the country.

PETER SINGER: There were reports of, literally, companies hiring bouncers to do security detail duties in Iraq. That's a training issue. You also have a question of their—

MARTIN SMITH: [on camera] You got something against bouncers?

PETER SINGER: In terms of having them on the ground, carrying submachine guns that they've never learned how to use, out there getting into firefights that not only impinge upon that company but, by the way, impinge upon the entire U.S. military operation?

MARTIN SMITH: These companies have training. They have training by former you know, special forces.

PETER SINGER: Sometimes companies have let in people who have backgrounds that we would not want to be there.

[www.pbs.org: Read Singer's extended interview]

LAWRENCE PETER, Private Security Assn., Iraq: There's always going to be a small percentage of people who don't do a good job in any industry.

MARTIN SMITH: [voice-over] In 2004, Lawrence Peter was the U.S. official in charge of regulating the security business in Iraq. Now he's left government and is an industry rep.

[on camera] Is there active debate within the business as to what jobs are appropriate and which jobs are not appropriate?

LAWRENCE PETER: Right now, you've got private security companies who've been asked to do certain missions, and they're going to do those to the best of their ability within the framework in which they're provided. They operate under clearly defined rules for use of force.

MARTIN SMITH: Was there ever a time when a private security contractor was reprimanded?

LAWRENCE PETER: Well, there may have been. But that typically would be between the contracts officer who hired that private security company and the private security company.

MARTIN SMITH: You would have been in a position to know.

LAWRENCE PETER: I'm not aware of any incidents, offhand. I mean, someone could bring up something to me or something like that, but—

MARTIN SMITH: But that's the issue. There's no transparency. If there have been any kinds of reprimands, we don't know about them. And we don't even know if there have been any.

LAWRENCE PETER: Is there a responsibility for every company to tell me if they're having a difficulty or not? No. Companies are very self-reliant, independent, and they're going to do the things that they need to do. This is a business matter.

Camp Navistar, Kuwait

TELEPHONE VOICE: You have reached Kellogg, Brown and Root's overseas employment hotline for LOGCAP III.

MARTIN SMITH: [voice-over] The biggest contract in Iraq is with Halliburton subsidiary KBR, a logistics company that provides support for U.S. troops around the world.

TELEPHONE VOICE: We are hiring for operations for Iraq, Kuwait, Afghanistan, Uzbekistan and Djibouti.

MARTIN SMITH: KBR is still hiring.

TELEPHONE VOICE: Living conditions in the Middle East are extremely harsh. Iraq and Kuwait are located in a desert climate, with an average temperature of 120 degrees.

MARTIN SMITH: So far, KBR has been asked to perform nearly $12 billion worth of services.

TELEPHONE VOICE: Afghanistan and Iraq are listed as hazard zones by the Department of State. Therefore, you will receive hazard pay. To return to the main menu, press 1.

MARTIN SMITH: KBR is the military's lifeline, its main supplier. KBR's convoys don't use private security, they are provided military escorts.

SOLDIER: Any kind of contact, just keep on moving. Our gun trucks will fix and flank on those, and we should be OK. If for some reason you do get broke up, just keep on going. We'll go a couple of miles up the road, we'll rally, then we'll get everybody together.

MARTIN SMITH: We wanted to ride along with KBR's drivers, but the company told us it's too dangerous.

SOLDIER: If no one has any questions, we'll get in our trucks and get going. Let's roll!

MARTIN SMITH: One out of every three convoys comes under fire. Over 65 KBR employees, 16 of them truckers, have been killed since the beginning of the war.  The biggest attack came on April 9, 2004, when insurgents ambushed a 19-truck KBR convoy. Six drivers were killed. Coming just a week after the Fallujah attack, contractors across Iraq were increasingly terrified.

INSURGENT: [subtitles] Here's our American prisoner!

THOMAS HAMILL, KBR: They attacked our convoy.

MARTIN SMITH: Lead KBR truck driver Thomas Hamill was taken hostage and held for 23 days. Another KBR trucker is still missing.

After the April 9th incident, we were told that scores of KBR truckers refused to drive until security improved. Hundreds of contractors left the country. For weeks, the military was left with dwindling stores of ammunition, fuel and water.

PETER SINGER: The contractor is not part of the chain of command, and they can decide to leave when and where they want. They can decide to leave if they get a better job offer by another private military company or by some other company back home. They can decide to leave because they're just tired of this. These are all decisions that a contractor has the discretion to make that someone within the military does not. And so what you've done is put a level of uncertainty into your military operation, and military operations are not a place that you want uncertainty.

MARTIN SMITH: The Army's after-action report for April 9th concluded that KBR's truckers needed to be trained to fire weapons, to be more like soldiers.

Camp Arifjan, Kuwait

When KBR was initially tasked to assist the U.S. military, the assumption was that the war would be short-lived and that KBR would wind down its operations quickly. Instead, it grew far beyond all expectations.

RUSSELL BAGGERLY, Movement Manager, KBR: This is huge. This is bigger than the biggest logistics operation that there is. This is world-war-scale logistics boiled down to a very refined process. All commodities in, all commodities out, personnel in, personnel out, military equipment in, military equipment out. We provide movement control reports on the movement of everything.

MARTIN SMITH: KBR's trucking hub is Camp Arifjan in Kuwait. It sprawls over 10 square miles. Through here, KBR has shipped and delivered 500 million gallons of fuel and a hundred million pounds of mail. Of the 50,000 people KBR employs, 13,000 are Americans, the rest are lower-paid workers from the Philippines, India, Bangladesh and Sri Lanka. They work at over 60 sites throughout Iraq and Kuwait.

The first KBR employees arrived six months before the invasion of Iraq. They built the bases and maintained the equipment. While Americans debated whether to go war, KBR was hard at work.

Historically, there is nothing new about the military's use of private contractors. What's new is the scale. Jobs like air traffic control, the refueling of aircraft and the maintenance and loading of advanced weapons systems were always the sole province of soldiers.

A change in policy dates back to the end of the cold war when the Pentagon was downsizing. The then secretary of defense, Dick Cheney, first hired Halliburton as a consultant. The rest is well known. After leaving government, Cheney became the president of Halliburton, parent company of KBR.

Lt. Gen. PAUL CERJAN (Ret.), V.P. Worldwide Military Affairs, KBR: And they came up with the conclusion it's cheaper to outsource. So they outsource to KBR, and we got the contract. We do what they ask us to do. We support the military with an equivalent of over 30 battalions worth of support. That's a lot.

[www.pbs.org: Does outsourcing save money?]

Camp Victory, Baghdad

MARTIN SMITH: KBR runs dozens of Army bases in Iraq, and all the ones we visited had a food court like this one. You can have pizza, a burger or a hero. KBR set up Camp Victory inside one of Saddam's former palace complexes. It's impressive enough, but KBR was eager to show us something even bigger. We were flown 40 miles north of Baghdad, to the largest military base in Iraq.

Camp Anaconda, Balad

Located in the Sunni Triangle, some call it Fort KBR. I've never seen anything like it. Here there are vast neighborhoods set behind concrete barriers known as Bremer walls: 28,000 soldiers and 8,000 contractors live here. There's a Wild West-themed post office with a captured Iraqi anti-aircraft gun out front, a movie theater next to another Subway franchise, and a rec center where soldiers can relax away from the battlefield.

GARRY CARTER, Project Manager, KBR: We have gyms, salsa dancing, Taekwondo, and you name it. There's probably something for everybody there is.

MARTIN SMITH: KBR's Garry Carter is nicknamed "the mayor of Anaconda."

GARRY CARTER: We have the sewer system on the base. We have the water production on the base, providing about 1.3 million gallons daily. Our laundry facility here, we do about 80,000 bags of laundry a month. We have over a thousand generators on this base, running, providing power here. That's a key element, the power that will power the lights, the pumps, the air conditioners, the heaters.

MARTIN SMITH: [on camera] You're doing a lot better than a lot of the Iraqis.

GARRY CARTER: We're trying to provide that power.

We have the food service here on the base, 105,000 meals a day, feeding over 30,000 individuals.

MARTIN SMITH: So you've got 35,000 people, 105,000 meals a day you're serving here. Do you have that broken down in terms of cost?

STEPHANIE PRICE, KBR Media Relations: We don't break that out.

GARRY CARTER: We don't— we don't break it out. It's— it's—

STEPHANIE PRICE: We can't get the total definitization, but we don't break it out by individual task order.

MARTIN SMITH: [voice-over] That's Stephanie Price of KBR media relations.

[on camera] So you don't have a cost per meal?

STEPHANIE PRICE: We don't break it out that way.

MARTIN SMITH: So if I was going to try to figure out how much it was costing to serve, cook the food, how would I go about doing that?

STEPHANIE PRICE: I'll redirect you—

GARRY CARTER: She can direct you to that.

STEPHANIE PRICE: I mean, we're really here to show you the level of service. If you want to go back, then I'll take you back to Paul.

MARTIN SMITH: Can you give me some idea of how much it costs to run this city in a day?

GARRY CARTER: No. Not actually.

MARTIN SMITH: [voice-over] Stephanie continued the discussion in the car.

STEPHANIE PRICE: Marty, I'm just telling you how we release our figures per the government. No one's going to break down costs per camp for you. It's just not going to happen.

MARTIN SMITH: [on camera] You know, this is what concerns people because when it's under the military, it's public information. And once you privatize services that are provided with taxpayer dollars—

STEPHANIE PRICE: It's public information, but they don't break it down per camp. I mean, you can't.

MARTIN SMITH: Well, what if I want to find out how much it's costing to feed troops or to clean latrines, just that specific information?

STEPHANIE PRICE: Well, then, I mean, see if the military will provide you that.

MARTIN SMITH: OK.

[voice-over] We went to see the other mayor of Anaconda, base commander Colonel David Fitzgerald. We found him presiding over a ceremony, handing out certificates of recognition to KBR employees. I took Stephanie's advice and asked the colonel about costs. He was refreshingly open.

[on camera] Do you break costs down? Do you have an idea of how much it's costing you to feed each one of your soldiers, for instance?

Col. DAVID FITZGERALD, Base Cmndr., Camp Anaconda: Sure do. Not only do I break it down, I have a meeting every week. A number of my staff members have a meeting every week, and we look specifically at that with KBR, and we track those costs.

MARTIN SMITH: Do you know how much it costs to feed a soldier?

Col. DAVID FITZGERALD: It costs roughly— I think it's— it's probably in the neighborhood of about $20 a plate per service. And we have quite a few servings per day.

MARTIN SMITH: [voice-over] The quality and range of services KBR provides to soldiers is impressive, but cost is a real issue. An audit by the U.S. Government Accountability Office of dining hall costs for one four-month period alleges KBR charged $88 million dollars for meals they never served. And Pentagon audits allege that KBR overcharged $108 million for fuel and billed the government $1.8 billion in other unsupported costs. The Pentagon terminated the fuel contract. As for meals, KBR says workers prepared food that just wasn't consumed. And the unsupported 1.8 billion, KBR says, is a paperwork issue that's being resolved.

[on camera] You've got at least four vigorous investigations going on. Other big companies have operated in this theater — Bechtel, Parsons, in the oil sector and reconstruction — they haven't attracted as much attention. Halliburton, KBR, gets singled out as a particular target. Why?

Lt. Gen. PAUL CERJAN (Ret.), V.P. Worldwide Military Affairs, KBR: I don't know. If I knew the answer to that, I'd probably be in politics or religion.

MARTIN SMITH: Well, you must have— you must do some thinking about it.

PAUL CERJAN: Well, I've got some feelings about it. I mean, the only thing we can do is stand up and give a true and honest evaluation of what we've done, show the documentation and why we arrived at those conclusions, and let whoever is making the assessment make the assessment. We are not afraid of that process. We are not afraid of that process at all. I welcome it because I'm a taxpayer, too.

MARTIN SMITH: [voice-over] KBR has inspired a cottage industry of critics charging undue political influence and financial fraud. But for all the controversy, there are many in Wall Street and in Washington who believe KBR is making only a slim profit, that they've been simply overwhelmed by the military's needs and failed to adequately track costs.

The Pentagon never intended to keep so many troops in Iraq for so long anyway. But now Anaconda is slated to become one of four so-called "enduring bases" in Iraq. Some veteran officers complain that it's a bad idea in a war zone.

Col. THOMAS X. HAMMES, U.S. Marines (Ret.): We did it in Vietnam, too. We created these huge base isolations in Vietnam, where we set ourselves aside from the population, created great luxury for the forces that lived there. And that doesn't really get you anything in the counterinsurgency. It creates a lot of problems. If the assumption is this is a peacetime occupation and then you wanted— your bases to start to look like Germany. If you think you're still in a war zone, you build a different structure altogether.

I frankly was stunned at the level of care. I mean, the big-screen TVs, the three main courses, three kinds of ice cream with multiple flavored toppings, several kinds of pastries, and all of these sorts of things, some feeling that we have to do this because the troops won't respond otherwise. I don't think that's true. The five months I was in Somalia with the Marines, we never really had a hot meal. There were no showers built. Nobody seemed to have a problem with that. I mean, you're in a war.

So this is misguided luxury. Somebody's risking their life to deliver that luxury. Maybe you could tone down the luxury, put fewer vehicles on the road.

MARTIN SMITH: [on camera] Retired military say, "You know, our soldiers don't need three flavors of ice cream. They don't need lobster," or "They don't need cordon bleu. What they need is a safe, secure environment." What's your reaction to that?

PAUL CERJAN: Well, first of all, the American soldier loves milk and ice cream. And so if that makes him feel better, why shouldn't you provide it? I mean, there's a lot to be said about bringing an individual inside the wire and providing him these amenities that don't have to be provided by soldiers. I mean, I spent my entire career watching soldiers pull KP in the kitchen. Why do we have to do that with soldiers? Why can't we outsource that mission?

MARTIN SMITH: [voice-over] In an all-volunteer Army, no one is going sign up and clean latrines. The Army is failing to make its enlistment quotas as it is. But in Iraq, soldiers we spoke to were not sure about using private contractors, either.

SOLDIER: The thing is, is you just can't tell one of them to go man a guard tower. You can't tell one of them that they need to pull security or go out on a raid or do a different job. You can't make them do push-ups if they screw up. Basically, they just get fired, go home, and they get another person they can use for a year.

MARTIN SMITH: Before we came to Iraq and after we returned, we tried to ask top Pentagon officials responsible for acquisition, manpower, logistics and procurement questions about outsourcing. They all declined to be interviewed. Other officials told us that outsourcing is a sensitive issue in the Pentagon.

[www.pbs.org: More debate on military outsourcing]

Besides 50,000 contractors working with KBR doing troop support and 20,000 private security guards, there are another 40,000 contractors working for companies like Bechtel, Parsons and GE on reconstruction jobs at scattered sites throughout Iraq. To see them, we needed once again to travel outside the walls of the Green Zone.

PRIVATE SECURITY GUARD: We have a fully qualified medic in the rear vehicle. We have a medical bag in each vehicle. It's the blue bag behind your seat.

MARTIN SMITH: We rode along with a security company taking some personnel to a power plant outside of Baghdad. For their safety, both the security guards and the client asked not to be identified. We were told the trip would take about half an hour, but not far from the center of Baghdad, we hit traffic. The guards get out to set up a kind of security perimeter.

TEAM LEADER: OK, stay calm, guys.

MARTIN SMITH: Then the commander notices a white sedan on the right shoulder and alerts his guards over the radio.

TEAM LEADER: The one parked on the right there, little white one. Two front, one rear. That guy's still giving you the eye.

MARTIN SMITH: He thinks the car may be loaded with explosives.

TEAM LEADER: No, don't walk up on them because if they detonate, you're done.

MARTIN SMITH: Sitting still, we are vulnerable. The commander decides to reroute us back through the center of Baghdad. Eventually, we get through town, but on the way back out, we hit another traffic jam, this time on a bridge. We are boxed in. All the defensive driving in the world cannot protect you from a suicide bomber here.

TEAM LEADER: Gentlemen, I'm going to recommend we abort this mission and try it another day. Let these guys through and make a space so we can turn around.

MARTIN SMITH: We never did get to see the new power plant.

GUARD: Sorry, gentlemen. We gave it our shot.

MARTIN SMITH: Last June, a convoy of GE contractors were on their way to a power plant outside Baghdad. Three GE employees and two security guards were among 13 dead and 62 wounded in a bomb attack. The total number of contractors that have died since the war began is hard to say. More than 300 contractor deaths have been reported in the press, but not all companies report casualty numbers.

Families of contractors who've been killed in the line of duty have recently taken some companies to court in the U.S. The families of the four guards killed in Fallujah are suing Blackwater for wrongful death. But in a privatized war, it's hard to determine who can be held responsible.

DONNA ZOVKO, Jerry Zovko's Mother: I blame Blackwater, its employees. But I am very upset that our government allows companies to do business the way they do in Iraq.

KATY HELVENSTON, Scott Helvenston's Mother: Our government cannot subcontract out their wars and take no accountability for anything that happens. And that's basically what they're doing.

MARTIN SMITH: A tangled chain of contracts has so far obscured any final accountability. Blackwater was contracted through a Kuwaiti company, Regency, to a Cypriot company, ESS, the food caterer. But ESS has refused to tell FRONTLINE exactly who they were working for.

We asked ESS about a clause in its contract that references KBR. Without explaining the clause, ESS said it wasn't working for KBR on March 31st. KBR also says it wasn't involved, and that under the terms of their contract with the Army, KBR and all its subcontractors must use military security.

I asked KBR's Paul Cerjan if he could clear this up.

[on camera] Why was Blackwater involved in providing ESS trucks, security? They were picking up kitchen equipment from the 82nd Airborne.

PAUL CERJAN: I have no idea. That was a year ago. I can tell you what the situation is today contractually, but I have no idea what the contractual situation was—

MARTIN SMITH: Were you here then?

PAUL CERJAN: No.

MARTIN SMITH: Is ESS a subcontractor today?

PAUL CERJAN: Yes. They have some dining facility contracts, yes.

[www.pbs.org: More of KBR's response]

MARTIN SMITH: [voice-over] Untangling the chain is impossible without cooperation from the companies.

[on the phone] Hello? Yes. I'm looking for Alan Morgan George—

[voice-over] While we were in Kuwait, I tried to reach ESS.

[on the phone] Who could I talk to there who's managing the catering contracts in Iraq right now?

[voice-over] I had no luck. And since then, ESS has refused to discuss the language in the contract. Blackwater, which denies responsibility for the contractors' deaths, says it doesn't know who directed the March 31st mission.

The man who managed the Army's logistics contracts in spring, 2004, was also unable to clarify what happened.

[on camera] What happened in the case of the Blackwater contractors who went into Fallujah, and they— they were protecting trucks that were going to pick up kitchen equipment. It's in violation of the contract that you had, correct?

Gen. PAUL KERN, Army Material Command (Ret.): No, I can't tell you that it was a violation of the contract.

MARTIN SMITH: Why not?

PAUL KERN: Because it was— because of the— at the level at which it was being conducted, within subcontractors, both the security and the— and the sources, I can't tell you that they violated the contract.

MARTIN SMITH: Very frustrating to have that sort of lack of visibility in contracts.

PAUL KERN: True. But again, we're— we're operating— more than 42,000 people spread over, literally, millions of square miles across Southwest Asia, and our ability to look at every single thing in a contingency-type operation just doesn't exist.

MARTIN SMITH: [on camera] With so many contracts and so little transparency, we may never know what happened on March 31st, 2004, nor who is liable. With the Fallujah contractors case not yet scheduled, the families are forced to wait.

Our trip is nearly over. We have only one decision left to make: How to get to the airport. As we are deciding, we learn that there been attack on the airport road involving the team we rode with two days earlier. This man, who had protected us, was killed. That same day, there was another attack. Andy Melville at Erinys showed us an insurgents' video off the Internet.

ANDY MELVILLE, Project Director, Erinys Iraq: This clip is particularly distressing. And it shows the execution of a private security operator.

MARTIN SMITH: Skylink, a contractor that ferries people from the Green Zone to the airport, has had a helicopter shot down north of Baghdad. Ten men are killed in the crash, including six Blackwater security guards.

INSURGENT: Stand up! Stand up!

MARTIN SMITH: The Skylink pilot, a Bulgarian contractor, is the lone survivor of the crash.

INSURGENT: Go, go! Go!

MARTIN SMITH: He is also the last victim.

INSURGENT: [shooting] Allahu akbar! Allahu akbar! Allahu akbar!

MARTIN SMITH: We opt to go to the airport by road with a Russian detail from Erinys. The military calls this "Route Irish." The Iraqis call it "Death Road." In the last four months, there have been at least 150 attacks on this 10-mile stretch. The U.S. military and their partners in the private sector have been unable to secure this vital link.

America's exit from Iraq is hard to envision, but it's clear that the private contractors we met will be in business for a long time.

We've cleared the last checkpoint. An airport has never looked so good.

Private Warriors

WRITTEN BY
Martin Smith

PRODUCED BY
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Martin Smith

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ANNOUNCER: Visit FRONTLINE's Web site for more on this report, including a rundown of major private contractors operating in Iraq today and the ongoing investigations of some of them, a collection of personal photos and stories from civilian contractors in Iraq, a look at the history of civilian contractors performing security functions in a war zone, background on the making of this program from FRONTLINE's producers, and extended interviews with contractors, military officials and other experts, plus streaming video of the full program and more at pbs.org.

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