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Lockheed Martin, based in Bethesda, Maryland, was awarded military contracts for fiscal 2003 totaling more than 69 billion dollars. Its campaign contributions in 2002 were more than nine million dollars, so the return on the initial investment is more than reasonable. That year, Lockheed Martin CEO Vance Coffman collected a hefty 25 million dollar salary. Lockheed Martin manufactures F-16 and F/A-22 jet fighters, the world-famous C-130 Hercules transport plane, and the lethal Hellfire and Javelin missiles. Hellfire missiles have been used to whack terrorists from the Gaza Strip to the Khyber Pass and beyond.

Next in line and always a contender, we have Boeing. Now headquartered in Chicago, this giant aircraft maker generated 60 billion in government business in 2003. But Boeing was a bit savvier than Lockheed Martin; it only had to shell out four million dollars in campaign contributions. Phillip Condit, the CEO, collected a measly four million in salary. The stockholders must be pleased, as the number for both companies seem to wash each other out. Boeing manufacturers the F-15, C-17 transport plane, the Apache Helicopter, and numerous brands of “smart” bombs, that somehow managed to wipe out mostly the wrong targets.

But to be fair, these two blue-chip name companies, in the market for decades, are the 800-pound gorillas of arms manufacturing global corporations. They have produced some of the most famous combat aircraft of all time, and they sell to clients all over the globe. They proudly put their cost-over runs out in the open for everyone to see, and war profiteering to them has been propagandized into nothing more than the cost of R & D and doing business the American Way. Milo Minderbinder would be proud.

These companies didn’t necessarily have to ride the hysterics, uncertainty, and fear of post 9/11 to make millions. But there is one company that did.

Custer Battles

I am not making this up. The name of the company IS Custer Battles. Two Army veterans, Scott Custer and Michael Battles, established this business in October 2001. These two thirty-something entrepreneurs had little experience in private security. But Mike Battles had political experience, having been a former Republican Congressional candidate in Rhode Island. He and Custer set up shop in McClean, Virginia, and then headed to Washington and the Pentagon to make their fortune. They were lucky or good or connected, because in June 2003, they won a 16.5 million dollar deal to guard Baghdad International Airport. Having no troops of their own, they ended up by hiring Nepalese mercenaries, the guys with the knives, who had served in the British Army’s Gurkha Regiments. Using folks from Nepal has become popular. At $1,000 U.S. a month, they are paid less, even poorly, than the average merc. But take look at the map. Nepal is in the middle of the Himalayas, where jobs are few and not even Wal-Mart has a foothold. For some soldier-of-fortune wannabees, this could be the ticket to sea-level. It was the first major contract for the security neophytes. Since then, Custer Battles has generated more than $100 million in deals. One contract calls for that company to train the newly formed and since unraveling Iraqi Army, but then EVERYONE has a contract to train the Iraqi Army. Another contract has the company protecting the new currency in Iraq.

Custer Battles’ Last Stand??

The company is now charged with over charging the Federales by tens of millions of dollars. Made public on October 8, a lawsuit was filed under the False Claims Act. The U.S. Air Force alleges that Custer Battles marked up invoices by as much as 162 percent. The Pentagon has banned the company from any further government contracts under the matter is resolved.

Custer Battles Calls the Charges “Baseless”

The above-mentioned currency protection amounts to little more than well-armed payroll guards, but it can get tricky. Last December, British-based Global Risk Strategies, a well-known private military contractor, was contracted to oversee a portion of the changeover of Iraq’s currency from that of the former regime. On December 1, Fiji mercenaries (that’s right, I said Fiji mercenaries) hired by Global Risk randomly opened fire after a currency changeover convoy in their charge came under attack. Ten Iraqi civilians were killed, and dozens were wounded. Fijian mercenaries are also popular to hire, as they contract out at the aforementioned $1,000 U.S. a month. I was unaware that Fiji had any military tradition whatsoever.

While the Fijians’ military skills may or may not be in question, their skill as negotiators certainly is. As mercenaries go, they are definitely bottom feeders. A thousand dollars a month is less that chicken feed. At the top of the mercenary heap are the British and the South Africans. No self-respecting ex-Special Air Service (SAS) operative would strap on a weapon for less than a $1,000 U.S. A DAY. Not to be outdone, American firms are working hard to close the gap. Black Water Corp., based in North Carolina, is staffed by ex-U.S. Special Forces, SEALs, and Army Rangers. These fellows also know how the Pentagon works when it comes to payroll and potential risk. Convoy escort duty in a nasty place such as Fallujah can get downright dangerous. Black Water is paying its troops as much a $1,500 U.S. a day. Of course, Black Water bills Uncle Sam and the American taxpayer. Black Water also has hired 60 Chilean ex-commandos. But salaries for them remain unclear.

The amount of money up for bid is staggering. The details are hard to come by, but the latest estimate is that, of the last $18.6 billion dollars that the Bush administration has shelled out for Iraq reconstruction, 25 percent will be used for to pay security companies. No wonder the Iraqi mercenary gold rush was on. David Claridge, managing director of the Risk Advisory Group, has said that annual revenue has increased for just the Brits to more than $1.7 billion U.S. Risk Advisory Group, a company that advises governments and leading businesses on security matters, is one of many British private military contractors cashing in on the Iraq reconstruction bonanza.

The contracts have gotten so lucrative that many soldiers on both sides of the Atlantic are taking stock. Many have left the service (before the stop loss orders went into effect) and have returned to Iraq as private employees. The risks are indeed the same, but the pay is much better. Of course, you can’t get paid if you are dead.

Many private soldiers take the money and run; there is no contractual obligation for them to put themselves in harm’s way. The U.S. taxpayer is left to pay the bill. By Grady Hawkins

The so-called War on Terror is hardly a war at all; it’s a going concern. And business is very, very good. The now well-known military-industrial complex, made infamous in President Dwight Eisenhower’s farewell address, is closing deals and collecting contracts for jobs all over the globe. Mercenaries have morphed themselves into respectable button-down corporations, and the world’s oldest profession (or second oldest??) is cashing in as well.