Public War, Private Fight? 

 The United States and

 Private Military Companies 

 

Combat Studies Institute Press

Fort Leavenworth, Kansas 

Deborah C. Kidwell

 

Global War on Terrorism

Occasional Paper 12
 Public War, Private Fight?

 The United States and 

 Private Military Companies

 

Combat Studies Institute Press

Fort Leavenworth, Kansas 

by 

 Deborah C. Kidwell
Library of Congress Cataloging-in-Publication Data

Kidwell, Deborah C., 1959-

 Public war, private fight? : the United States and private military companies / 

by Deborah C. Kidwell

p. cm.

Includes bibliographical references.

1. United States--Armed Forces--Procurement. 2. United States--Armed Forces--

Procurement--History--21st century. 3. Iraq War, 2003--Engineering and construction. 4. Iraq War, 2003--Equipment and supplies. 5. War on Terrorism, 2001--

Engineering and construction. 6. War on Terrorism, 2001--Equipment and supplies. 

7. Defense industries--United States--History--21st century. 8. War--Protection of 

civilians. I. Title.

UC263.K5 2005

355.4’1’0973--dc22

2005019980

CSI Press publications cover a variety of military history topics. The views 

expressed in this CSI Press publication are those of the author and not necessarily 

those of the Department of the Army or the Department of Defense.

A full list of CSI press publications, many of them available for downloading, can 

be found at <http://cgsc.leavenworth, army.mil/carl/resources/csi/csi.asp>.
iii

Foreword

Like the other monographs in the Combat Studies Institute’s Global 

War on Terrorism Occasional Paper series, Public War, Private Fight? The 

United States and Private Military Companies provides another case study 

for use by modern military leaders to help them prepare themselves and 

their soldiers for operations in the current conflict. This work examines the 

widespread use of contractors by the military to help fill the massive and 

complex logistical requirements of a modern military force. Ms. Kidwell 

examines the use of Private Military Companies (PMC) as far back as the 

American Revolution and follows their evolution through the War with 

Mexico, the Civil War, the Spanish-American War, and the first Gulf War. 

She then analyzes the use of PMCs in Operation ENDURING FREEDOM 

and Operation IRAQI FREEDOM. Ms. Kidwell concludes that PMCs 

will be an increasingly important facet of US military operations for the 

foreseeable future; however, the use of contractors on the battlefield is not 

a panacea for all logistics problems. Logisticians, contractors, and military 

leaders who have responsibility for such operations in the current conflict 

against terror will gain useful insights to the advantages and disadvantages 

of these combat multipliers after reading this Occasional Paper.

Timothy R. Reese

Colonel, Armor 

Director, Combat Studies Institute
v

Contents

Foreword .................................................................................................iii

Preface .................................................................................................... vii

Chapter 1. Private Military Companies and Public Military 

Institutions ............................................................................. 1

Chapter 2. Historical Precedents .............................................................. 9

Chapter 3. Operations IRAQI FREEDOM and ENDURING

FREEDOM........................................................................... 27

Chapter 4. The Future of PMCs During US Military 

Operations ............................................................................ 39

Chapter 5. Conclusions .......................................................................... 65

Bibliography .......................................................................................... 69

About the Author .................................................................................... 79
vii

Preface

The United States has long utilized private military contractors 

to augment regular military forces in support of its national foreign 

policy and security needs. Commonly referred to as Private Military 

Companies (PMCs), contractors employ and manage civilian personnel 

from the private sector in areas of active military operations. Frequently, 

regular troops become dependent on the services contractors provide—a 

situation that may negatively impact military effectiveness. Since 1991, 

contractor support on and off the battlefield has become increasingly 

more visible, varied, and commonplace. Given the current manpower and 

resource limitations of the national military, the US will likely continue 

its extensive use of PMCs in support of military operations. This work 

addresses historical precedents and trends in American logistics, the 

current scope of contractor involvement in support of regular military 

forces, and the challenges posed as traditional military institutions integrate 

increasing numbers of civilian workers and privately owned assets into 

the battlespace. These problems increase the risk to US personnel and 

can induce budget overruns rather than savings, disrupt civil-military 

relations, and have detrimental consequences for the American economy 

and society. The work concludes by proposing a useful rubric to evaluate 

this “new” American way of war. 

This work considers PMCs and their interdependence with regular and 

reserve military units in a broad sense. It derives from unclassified material 

widely available; understandably, these sources limit the analysis. Lessons 

learned from the Operation IRAQI FREEDOM (OIF) and Operation 

ENDURING FREEDOM (OEF) theaters may alter findings. However, this 

study endeavors to frame the continuing dialog concerning the appropriate 

use of PMCs to support regular troops. It should stimulate further research 

and discussion by reviewing the history, theory, doctrine, and practice of 

employing private contractors on the battlefield. It is admittedly Armycentric; however, in a joint environment and with a common acquisition 

framework provided by joint doctrine, the generalizations garnered from 

this analysis will be relevant to other service branches. This work spends 

less time on the positive aspects of contractor support, as other publications 

discuss these advantages in detail.

I would like to acknowledge the assistance of several key individuals 

and to thank all others who have influenced my life and work. Colonel 

Lawyn Clay Edwards (USA Retired) provided the initial inspiration 

and assignment. Great respect and gratitude is due the Director and 

Deputy Director of the Department of Military History (DMH), Dr. 
viii

James Willbanks and Dr. Richard Barbuto, who provide an excellent 

environment of confidence and intellectual freedom for new instructors. 

Dr. Glenn Robertson, LTC Marion Vlasic, Betty Weigand, and the staff 

of CSI provided valuable advice and assistance. I appreciate all faculty 

and administrative members of DMH who provided crucial moral 

and intellectual support. Special thanks go to Dr. Chris Gabel, Dr. Joe 

Fischer, and officemates Bob Kennedy, Scott Stevenson, and Gary 

Bjorge, who listened to my fledgling ideas and frustrations with good 

cheer and encouragement. As always, my family—Les, Charles, Andrea, 

and Steven—deserve thanks for sharing their wife and mother with the 

project. 

The composition of the force mix is a timely and extremely important 

issue that awaits a comprehensive analysis. Much operational research, 

documentation, and incorporation of lessons learned remains to be done. 

My hope is that the resulting manuscript provides a starting point for the 

discussion of the appropriate role and level of contractor support in the US 

military force structure and is helpful to the Nation’s many courageous 

and excellent soldiers, sailors, airmen, and marines. 
1

Chapter 1

Private Military Companies and Public Military Institutions

On 23 December 1941, Japanese military forces captured Wake Island, 

a tiny atoll in the North Pacific annexed to the United States since 1899. 

Approximately 453 United States (US) Marine forces and 1,150 civilian 

employees of the Morrison-Knudsen Corporation became prisoners of 

war.1 Wake Island remained under Japanese control until September 1945. 

Throughout the occupation, the Japanese evacuated the military prisoners 

and the majority of the civilian workers to prisoner of war (POW) camps 

located in China and Japan. Some 360 civilians, however, remained to 

continue military construction on the island. This group endured many 

hardships, including harsh treatment by their captors, insufficient food, 

poor sanitation, and overwork. A plaque mounted on a boulder near the 

site where the Japanese executed 98 remaining employees in 1943 serves 

as a simple memorial.2 This episode illustrates a number of advantages, 

risks, and consequences that accompany the practice of using private 

companies as an integral component of US military forces. Given the 

level of private resources included in the current force mix, it is important 

to consider what private military companies can contribute to or detract 

from military operations, why they engender controversy, and to apprise 

doctrine writers with insights gained from experience. Military effectiveness, along with a sensitivity to the individual needs of our most important 

resources—American soldiers, sailors, airmen, and marines—should be 

the overarching principles that guide future military policy. 

Private military companies (PMCs) have several common characteristics. Contractors are profit-driven organizations that provide professional 

military services for a global market. PMCs perform services closely 

related to the conduct of war that are the traditional responsibility of 

regular uniformed military personnel.3 The most common service categories include logistical support, transportation, engineering, construction, 

skilled and unskilled laborers, maintenance, technical expertise, and other 

paramilitary operations. They operate in a highly competitive global marketplace and adapt their products to meet market demands. PMCs choose 

their employers and the duties they will perform in accordance with company policy. They also utilize current business management philosophies, 

such as aggressive advertising and sales, outsourcing (subcontracting) of 

noncore functions where cost efficient, and controlled production and 

delivery systems to optimize profit. 

Although PMCs share many similar attributes, they can also differ 
2 

significantly in organizational structure, source of working capital, number of employees, and other characteristics. Contractors perform a range 

of services from highly specialized tasks requiring extensive training and 

experience—computer networking abilities and communications systems, 

for example—to unskilled general labor in dining halls, laundry facilities, 

and construction projects. PMCs vary in size and structure from large multinational corporations with a complex hierarchical corporate structure to 

simple partnerships and individual proprietors. 

P.W. Singer divides the private military industry into three categories 

based on their functional capabilities.4 Military provider firms concentrate on tactical situations, often participating directly in actual conflict. 

Consulting firms focus on building capabilities within the client’s military 

or civil defense forces. Typically, consultants provide analysis, advisory, 

and training services that can include organizational restructuring and 

campaign design. Support firms contribute many forms of nonlethal 

assistance to military forces in the field, including transportation services, 

maintenance and supply, logistical and technical support, engineering, 

intelligence, and financial management. Currently and historically, support firms have commanded the largest share of US military contracted 

dollars.5 In 2003, the US Army awarded four large task orders under the 

Logistics Civil Augmentation Program (LOGCAP) to Kellogg Brown and 

Root (KBR) worth over $587,988,500.6 These service categories roughly 

correspond to the traditional military functions of warfighting (provider), 

tactical combat support (consultant), and combat services support (support) personnel. Military logistics experts further divide contractor activity into specific in-theater, external to theater, and technological systems 

support.7 

Moreover, elements of continuity and change characterize the relationship between regular military forces and these civilians on the battlefield. Experience indicates that private contractors have been important 

participants in military operations. Throughout the 20th century, US forces 

relied on private companies to provide varying levels of transportation, 

construction, and base support services. However, the end of the Cold 

War and the removal of Iraqi forces from Kuwait in Operation DESERT 

STORM in 1991 marked a sea change in American warfare. The private 

military industry expanded rapidly to fulfill global security needs, even as 

many Americans predicted reductions in future military operations. As a 

result, many paramilitary activities became commodities. Political instability fueled this privatization trend. Civilian employees routinely serve as 

translators and technical representatives and perform facility and equipment 
3

maintenance, intelligence gathering and analysis, interrogation, security, 

and other duties. Two trends, privatization and the proliferation of paramilitary support services organizations, give the battlefield commander a 

number of options for mission completion. 

Although PMCs play an increasingly important role in contemporary 

warfare, the level of reliance on the private military industry has fluctuated over time. Ancient Egyptian armies hired Numidians; in a similar 

fashion, the armies of Alexander the Great, ancient Rome, the Swiss 

Guard, and Gustavus Adolphus employed large numbers of individuals 

motivated by adequate pay and steady work. The armies of Frederick the 

Great used private individuals to position their cannon on the battlefield. 

Typically, the US has utilized more contractor services and capabilities 

during peacetime to avoid the costs, and the possible political consequences, of a large standing military. Conversely, American forces have 

depended on regular and reserve forces during full wartime mobilization. 

After 1991, and particularly during Operation IRAQI FREEDOM (OIF) 

and Operation ENDURING FREEDOM (OEF), this general pattern has 

reversed. Private contractors now perform many functions that were 

formerly the responsibility of uniformed personnel disciplined under the 

Uniform Code of Military Justice (UCMJ). Moreover, contractors currently deploy to more forward (battlefield) positions than ever before, and 

a large number of contractors work outside active theaters. Many PMCs 

participate in active combat. Logistician Joe Fortner observes, “contractors are not replacing force structure, they are becoming force structure.”8

Currently, the US Army privately contracts aviation training and a large 

portion of their intelligence gathering and analysis duties. PMCs perform 

over 50 percent of the maintenance required by the US Air Force, and 

operate many of their communications systems—including those at the 

critical North American Aerospace Defense Command (NORAD) facility 

in Cheyenne Mountain near Colorado Springs.9

Supporting regular forces with PMCs has the potential to be cost efficient, to be politically expedient, and to enhance military effectiveness and 

national security. The use of contractors can expand the force rapidly and 

augment critical deficiencies in existing force structure. Industry analyst 

P.W. Singer writes, “Every major U.S. military operation in the post-Cold 

War era ... has involved significant and growing levels of PMF [private 

military firm] support.”10 Provider contractors can offer additional political advantages (regardless of cost) to their clients. They are not bound or 

easily influenced by popular sentiment; their operations often maintain a 

low profile in the public consciousness. Likewise, PMCs are given a clear 
4 

mission and budget, and, unlike established military doctrine and tradition, 

relatively few suggestions on acceptable methods or rules of engagement 

to accomplish their tasks, even though international laws of war generally 

apply. Private firms can potentially restore order to political chaos, halt 

killing and criminal sprees, and pave the way for effective democratization. Employees of International Charter Incorporated (ICI) of Oregon 

have been active in recent conflicts in Haiti, Liberia, and Sierra Leone, 

where, under a contract from the US State Department, they assisted a 

coalition of West African peacekeeping forces in halting what one reporter 

called “an orgy of looting, murder and decapitation” by militants challenging the existing government.11 Such interventions restore stability, 

although often short lived, to highly unstable regions. 

In a larger sense, however, using military providers can be a volatile 

solution that raises ideological, legal, moral, and ethical concerns. As 

profit-driven entities whose mission may derive from any conceivable 

source with funding, the services PMCs offer their clients do not necessarily derive from any compelling national or humanitarian interest. Only the 

written provisions of the contract define contractor responsibilities. These 

organizations are largely extralegal and are not bound or protected by the 

International Laws of War or typical rules of engagement. In fact, outspoken critics consider them to be simple mercenaries—warriors for hire 

outlawed by the Charter of the United Nations. Many PMCs frequently 

conduct operations in unstable, lawless situations and the old adage that 

power corrupts and absolute power corrupts absolutely can apply. In an 

unstable environment, PMCs are capable of becoming the law themselves. 

The extralegal status of these entities and other sovereignty questions have 

the potential to create international friction among allies and enemies 

alike, making joint and multinational operations more difficult for regular 

forces. Moreover, PMCs may complicate civil conflicts by becoming just 

another belligerent party in an already complex security environment. 

Despite the advantages and disadvantages of contractors on the battlefield, their use remains controversial. As we shall see, management is a 

crucial issue. Contracting agents must be careful to outline a specific statement of work (SOW) and to follow up with appropriate levels of supervision to ensure fiscal accountability and performance, particularly when 

regular military forces depend on contractors for their survival. Unresolved 

legal issues are legion, particularly regarding the status of civilians on the 

battlefield and the enforcement of contracts under wartime conditions 

with newly formed political authorities. Political and military leaders have 

yet to establish clearly the cost-efficiency of PMCs in their current roles. 
5

Numerous studies generated by government agencies, journalists, and 

congressional inquiries document cost overruns and unexpected indirect 

costs, such as corruption, increased security needs, and nonperformance. 

Furthermore, the consequences of the extensive privatization of military 

services to future US overall military effectiveness and mission capability 

remains unknown—and for now largely ignored. Americans may find that 

the indirect costs to society—potential loss of employment, education, 

and training opportunities, as well as an ever-widening gulf between the 

military and civilian communities—that result from the extensive use of 

PMCs may be more than the country is willing to accept.

Managing the force mix has crucial implications for American society. The lives of over 1,403,000 US military personnel, many currently 

deployed in harm’s way, are at stake.12 These troops depend on political 

leaders for the necessary assets to complete their assigned missions and 

return home safely; in addition, they count on military leaders to use 

resources wisely. Moreover, Federal military spending can place a great 

deal of the country’s financial wealth and economic well-being at risk. The 

Department of Defense budget in 2005 exceeds $401.7 billion.13 American 

citizens expect an effective and available force that can project national 

power and policy. Thus, national security and economic stability, indeed 

the very lives of Americans, hinge on the “right” force mix.

Remember that the increased reliance on PMCs to conduct US military operations is a conscious choice made by national political and military leaders. The current role of corporate entities on the battlefield blends 

the public and private spheres of interest in unique and uncharted ways. A 

number of risks, to include mission completion, force protection, loss of 

command and control, and disruption of civil-military relations, accrue to 

the growing dependence of national military forces on contracted services. 

Policy makers must continually revisit the lessons learned from experience, examine theoretical projections, and revise military policy and doctrine if the US is to manage effectively its resources and to maintain the 

military capabilities to achieve national security objectives. 
6 

Notes

1. Mark E. Hubbs, “Massacre on Wake Island,” <http://www.usyorktown. 

com/yorktown/massacre.html> (28 February 2005). From Gregory Urwin, Facing 

Fearful Odds (Lincoln, NE: University of Nebraska Press, 1997), Chapters VI 

and VIII.

2. Ibid.

3. P.W. Singer, “Corporate Warriors: The Rise and Ramifications of the 

Privatized Military Industry,” International Security 26:3 (Winter 2001/2002), 

4. See also his excellent work: Corporate Warriors: The Rise of the Privatized 

Military Industry (Ithaca, NY: Cornell University Press, 2003). While Singer’s 

work is the standard monograph on the private military industry, his analysis 

makes use of a variety of interdisciplinary methods (“international relations theory, security studies, political economy, comparative politics, industrial analysis, 

and organizational behavior,” from page ix). This work derives from a historical 

perspective that analyzes the role of contractors in American military operations 

and the implications of private military companies on the military capability and 

effectiveness of the United States’ Armed Forces. The Center for Public Integrity, 

an international consortium of investigative journalists, adds the useful caveat 

of “services previously provided by National Military forces such as military 

training, intelligence, logistics, offensive combat, and security in conflict zones.” 

See Laura Peterson, “Privatizing Combat, the New World Order,” The Center 

for Public Integrity, 28 October 2002, <http://www.publicintegrity.org/bow/

report.aspx?aid=148> (29 October 2004).

4. Singer, “Corporate Warriors,” 91.

5. Ibid., 91-99.

6. Laura Peterson, “The Windfalls of War,” The Center for Public Integrity, 

<http://www.publicintegrity.org/wow/> (10 December 2004).

7. Joe A. Fortner, “Managing, Deploying, Sustaining, and Protecting 

Contractors on the Battlefield,” Army Logistician, September-October 2000, 

<http://www.almc.army.mil/alog/issues/SepOct00/MS571.htm> (10 December 

2004).

8. Joe Fortner, Doctrine Division, USACASCOM, Army Doctrine Working 

Group Conference, Contractors on the Battlefield, 21 January 1998, quoted in 

Kolling, James G., et al., Potential Combat Risks from Outsourcing of Selected 

Sustainment Functions (Carlisle Barracks, PA: US Army War College, 2002).

9. Center for Public Integrity website, <http://www.publicintegrity.org>; 

<http://www.norad.mil> (1 March 2005).

10. Singer, “Corporate Warriors,” 188. 

11. Peterson, “Privatizing Combat.”

12. Selected Manpower Statistics, Fiscal Year 2003, Department of Defense, 
7

Table 2-4, Active Duty Military Personnel Strengths by Regional Area and by 

Country (309A), 30 September 2003, 29, <http://www.dior.whs.mil/mmid/M01/

fy03/m01fy03.pdf> (6 December 2004). More recent estimates (Carl Kasell, 

National Public Radio News, 1 November 2004) place 142,000 United States’ 

troops in Iraq, with over 40,000 in the Baghdad area. 

13. Office of Management and Budget website, <http://www.whitehouse.gov/

omb/budget/fy2005/defense. html> (6 December 2004).
9

Chapter 2

Historical Precedents

In the 19th century, historians used a considerable amount of ink to 

recount the military campaigns of legendary commanders; they wrote few 

words about the contributions of logistics to the success of military operations. Martin van Creveld, however, later argued that logistics played a 

central, rather than peripheral, role. He maintained that logistical support 

limited commanders’ strategic and tactical alternatives and, therefore, 

defined military effectiveness.1 Van Creveld noted a characteristic pattern 

of conflict based on the belligerents’ ability to sustain armies in the field. 

From the mid-17th century to the early 19th century, siege warfare generally rewarded the combatant most capable of sustained effort. Napoleon’s 

concept of supply as a combination of organic logistical capability and a 

reliance on the local environment restored mobility to military campaigns. 

In the 20th century, industrial war once again subordinated troops to rear 

supply lines and encouraged technological development in armor, transportation, and communications. Additionally, Van Creveld asserted that 

the ability of political leaders to provide resources to military institutions, 

who would use them judiciously to achieve their mission objectives, contributed more to victory than tactical or operational skill. 

Van Creveld’s book, along with earlier works by James A. Huston and 

Russell F. Weigley regarding the US Army, encouraged military historians 

to reexamine the contribution of logistical capabilities to military success.2

 John Lynn observed, “the central importance of logistics remains 

clear” to the outcome of medieval conflicts; John Shy maintained that a 

critical lack of transportation crippled the Continental Army.3 Moreover, 

historians continued to document elements of change and continuity in the 

development of American logistical capabilities. The use of contractors on 

the battlefield illustrates both trends. While their presence has remained 

a constant in American military operations, the role of what we now call 

PMCs has also changed significantly over time, particularly during the last 

three decades of the 20th century.

 Beginning with the American Revolution, private contractors and 

individuals routinely provided transportation and engineering services, 

skilled and unskilled labor, technical support, and manufactured the 

nation’s arms and armaments. Political leaders of the Early Republic, 

charged with the mandate to “provide for the common defense,” 

established public institutions—military and financial—to make resources 

available and develop laws, policies, and procedures for their proper 
10 

use. Political leaders, nevertheless, have wavered in their delegation of 

logistical capabilities as the primary responsibility of private enterprise 

or an internal military organization. Over the more than two centuries 

of the nation’s history, logistical burdens have shuffled among various 

civilian and military authorities. Presently, a confusing array of civilian 

governmental agencies, military institutions, private corporations, and 

individuals share the responsibility of maintaining US troops in the field.

Historian Charles Shrader identifies four thematic eras in the history 

of American military logistics.4 Shrader considers the period from 1775 

to 1845 the “Era of Creation.”5 One of the first challenges for the Early 

Republic was to establish and develop the organizations, institutions, and 

legal structure that would grow the military capabilities necessary to defend the nation. The American colonies overcame numerous challenges 

to support the Continental Army and their associated militia units against 

British regulars. Although the Continental Congress remained the primary 

agency in charge of procurement, transportation, and manpower throughout the duration of the war, they often relied on haphazard procedures and 

irregular purchases.6 With few established national institutions or laws to 

sustain war mobilization, decentralized leadership and unstable tax revenues hampered the effective provision for war. In June 1775, Congress established the Bureau of the Commissary General of Stores and Provisions 

to supply the US Army. The most common method in practice, however, 

was direct purchase of local supplies and services by military officers for 

their individual commands.7 This practice, as in the medieval era, proved 

to be generally ineffective, wasteful, and subject to fiscal abuse.

The lack of transportation capability severely limited military 

operations. Many individual teamsters (and their wagons) delivered 

supplies, and the system became extremely difficult to coordinate. John 

Shy observed that the inability to transport rather than inadequate supply 

“was a crippling deficiency militarily and economically” for the American 

war effort.8 By 1781, Congress centralized army procurement and 

management under the aegis of Philadelphia merchant and Superintendent 

of Finance, Robert Morris. Morris relied heavily on private individuals to 

provide and deliver supplies to the army. In addition, swarms of laborers—

cooks, medical providers, and laundresses, among others—accompanied 

the Continental Army. Although Morris’ effort was ultimately successful, 

it was considerably less than ideal. The disorganized nature of troop 

support during the Revolution prompted Americans to develop a body of 

regulations and to create an institutional support structure within regular 

military forces.
11

The process of national politics that provides manpower and resources 

to the military has a history of ambiguity. While the Constitution is the 

foundation for military command authority, over time political and historical precedents have influenced military operations. Article II, Section 2, 

gives the President the power of “Commander in Chief of the Army and 

Navy of the United States, and of the Militia of the several States, when 

called into the actual Service of the United States.” The power to declare 

war, make military appropriations, and “make Rules for the Government and Regulation of the land and naval Forces,” however, belongs to 

Congress under Article I, Section 8. This division of power often creates 

conflict between the legislative and executive branches of the American 

government and can hinder preparation for and the conduct of military 

operations. 

Americans attempted to provide for their fledgling military (and to 

resolve ambiguities concerning the balance of power) through effective 

institutionalization of military logistics agencies and to reduce waste and 

corruption through legislation. Powerful wartime presidents established 

strong precedents for the firm control of military forces by the nation’s 

top executive. Direct purchase by government officials worked well when 

officials tended to value quality and demand timely delivery; still, abuse, 

corruption, and waste attended the process.9 Private contractors, Huston 

observed, “were more interested in assuring their own profits than in delivering articles of good quality or making delivery at the times convenient 

to the purchaser.”10 Although the acquisition and delivery of supplies and 

munitions improved, oversight was minimal, and the system frequently 

rendered poor results.11 A decentralized military staff organization and 

poor roads and communication also challenged the nation’s ability to quell 

internal disturbances—such as the Whiskey Rebellion and local Indian 

wars—and project military power internationally during the War of 1812. 

Congress passed legislation to guide the process of military procurement beginning in 1798. Contracts were subject to a competitive bidding process that included a mandatory period of advertisement, banned 

advance payments, and prohibited compensation based on a percentage 

of funds that each contracting officer distributed. In addition, no member 

of Congress could profit from the supply and service contracts negotiated by the Secretary of War. Persistent fiscal abuse and poor performance led Congress to divide acquisition responsibility between several 

military agencies. The Office of Purveyor of Public Supplies coordinated 

purchases in 1792, and later the Corps of Engineers, Quartermaster, 

Subsistence, Medical, Ordnance, and Logistics Bureaus shared support 
12 

responsibilities.12 This legislative activity, however, contributed little to 

military effectiveness. American logistical capabilities did not improve 

significantly until the mid-19th century.13 

During the Mexican War (1846-1848) until the eve of the SpanishAmerican War in 1898, military personnel worked to establish standards 

of performance and training while continuing to develop internal logistical capabilities. Standardized policies and military institutions slowly 

improved logistical capabilities. The War Department spent over $78 

million for contracted goods and services, and growing in-house military 

capabilities helped to supply expeditionary armies better than ever before 

in the nation’s history.14 New modes of transportation and infrastructure 

improvements increased logistical and operational mobility. Congress 

reduced fiscal abuse by requiring a strict accounting of all receipts and 

payments. While the country’s ability to supply armies had improved 

military effectiveness, the decision to retain an internal military logistical capability or coordinate the process under civilian authority remained 

unresolved. In addition, procedures varied from one conflict to the next; 

sometimes officials relearned the contractual pitfalls, abuses, and the consequences of poorly supplied forces from experience.

Military organizations concentrated on “professionalization” during 

the last half of the 19th century.15 Profiteering and fraud plagued relationships between Union officers and support contractors early in the 

American Civil War. The problem was so prevalent that in July 1861, a 

committee in the US House of Representatives convened to investigate 

the issue. The extensive corruption they discovered prompted Congress 

to write additional reform legislation. Extensive reliance on the low-bid 

contract by government officials encouraged some manufacturers to sell 

inferior products. The contemporary meaning of the word shoddy (made 

of or containing inferior material, or alternatively dishonest, shabby or 

run-down) stems from this practice, which was widespread until officials 

realized that low-bid contracts often sacrificed quality and were not cost 

efficient.16 It was difficult to monitor and enforce changes under wartime 

conditions, and chronic widespread corruption continued, although less 

so as the war progressed. These 19th century challenges, however, concentrated on the expansion and defense of the US on the North American 

continent, rather than an emphasis on power projection that would occupy 

much of the following century. 

The challenges of incorporating new technology, the established traditions of a professional military, and the growing importance of the management of complex systems created an “Era of Specialization” from 1898 to 
13

1945. The army concentrated on developing internal capabilities to fight the 

next war as it entered the 20th century. The Quartermaster Corps—enlisted 

troops initially numbering 5,400 soldiers dedicated to logistical support 

tasks—enhanced military logistical capabilities.17 Quartermaster General 

Thomas Jesup proposed a transportation corps to resolve the critical shortage of transportation; Jesup believed that organizing this function under 

military aegis would improve reliability, double efficiency, and cut costs 

by at least one-third.18 Mobilization for World War I, however, blurred the 

public and private spheres of American life and ultimately brought private 

business into the partnership for war as never before. Large-scale mobilization required the coordination and cooperation of the government, her 

citizens, and private industry. The War Industries Board, populated by 

business and government leaders, harnessed American industrial might to 

its war machine through production management, coordinated purchases, 

and assured that needed resources reached the battlefield. 

Strict regulations governed procurement throughout World War I, 

although the disreputable found new ways to exploit the national emergency. Congress attempted to close these “loopholes” by banning advance 

payments, “cost plus a percentage of cost fee” contracts—deemed “expensive and wasteful,” and by limiting aircraft and ship manufacturers to an 

8-percent profit.19 Moreover, Congress made the competitive bidding processes that accounted for over 80 percent of contracts awarded in the interwar years mandatory, although unsuccessful bidders frequently accused 

their competitors of unfair competition, conflicts of interest, and poor 

workmanship.20 At the close of World War I, the National Defense Act of 

1920 returned many logistical responsibilities to military agencies. The 

nature and scope of World War II would overwhelm these capabilities.

During the interwar years, factors limited the development of military 

logistical capabilities. Before American entry into World War II, the US 

awarded maintenance and other service contracts to support allies in North 

Africa and the Middle East. Military units replaced many of these civilians 

after the official declaration of war in 1941. Civilian support labor became 

commonplace throughout World War II, although historian Lida Mayo 

later acknowledged “inherent dangers in assigning to a civilian contractor tasks that were essentially military.”21 Employees may abandon or fail 

to complete the work; enemies may kill or capture those that remain; in 

addition, security needs may increase and violations may result in costly 

sabotage or theft. The extensive use of foreign civilians as laborers often 

magnified risks in addition to complicating existing language and cultural 

differences. 
14 

The shortage of uniformed personnel necessitated the use of contractors to provide many goods and services—logistical support, transportation, engineering, skilled and unskilled labor, maintenance, and technical 

expertise—and the scope of these duties increased dramatically. Congress 

enacted a number of legislative standards to address the “staggering” 

problems produced by the prolonged and intense war.22 The National 

Defense Expediting Act of 1940 relaxed existing regulations and provided new opportunities for corruption to flourish. Government agencies 

were no longer required to advertise contracts, could approve payments 

in advance up to 30 percent, and the Secretary of War could, if necessary, 

build and operate industrial plants. Other legislation suspended routine 

fair labor practices such as the 8-hour maximum workday for government 

contractors and allowed generous tax amortization programs to encourage business expansion. Congress lifted profit limitations and reduced 

taxes for war industries.23 The system did profit from better management 

and accountability through the War Production Board, who coordinated 

production, renegotiated contracts, recovered overcharges, and policed 

abuses. 

Advanced technological capabilities created increased demands for 

contracted engineering services to build airfields and ports and to create 

deep-water harbors. The Army Corps of Engineers provided construction 

services and supervised international projects worth over $1.8 billion 

throughout the course of the war. Private building firms constructed many 

domestic projects—primarily military installations and housing—in total 

over $7.2 billion.24 Frequently, firms combined their assets in consortiums 

or subcontracted various aspects of the work. Throughout World War II, 

the majority of compensation was via cost plus a fixed fee contracts, as the 

extensive abuse from previous experience prompted Congress to prohibit 

the cost plus percentage of cost instrument.

Construction labor needs exceeded even the expanded regular and 

reserve capabilities. The Army reorganized in 1942-3, creating modulartype combat engineering battalions to operate heavy machinery and provide other construction services in addition to the capability of the Army 

Corps of Engineers. The Army supplemented military capability with private construction firms, most of whom made extensive use of indigenous 

labor.25 KBR became one of the largest government contractors. Aircraft 

manufacturers created maintenance and repair units they secretly stationed 

near operational theaters.26 Civilian laborers on the home front refurbished 

planes, tanks, and vehicles. While the war effort mobilized a great deal of 

manpower, civilians were rarely found in active theaters. Combat engineer 
15

battalions and US Navy Seabees relieved contractor employees when 

military action seemed imminent. Thus, while the number of civilian participants to support wartime activity increased dramatically, the nature of 

their involvement as noncombatants, for the most part, remained unchallenged. A few short years later, the war in Korea would build on the now 

institutionalized public-private sector partnerships forged during the two 

World Wars. 

Shrader labels the last phase in the development of logistical capabilities the “Era of Integration.”27 This process includes “centralized direction 

of logistical activities, organization along functional lines, and joint and 

combined operations employing a variety of advanced technologies.” The 

theme of integration extends to the incorporation of PMCs and coalition 

partners that is now a critical component of American warfare. This phase 

primarily took place after World War II and continues today. 

The Korean War created a number of new logistical challenges for the 

US Army. Throughout the war—27 June 1950 to 30 June 1953—US contracted expenditures exceeded $1,522,925,000. The Quartermaster Corps 

organized centralized service units capable of supply at the corps level.28

By far, the most critical problem throughout the war was manpower. 

American soldiers, sailors, and airmen, wearied by the previous conflict, 

were reluctant to volunteer. A peacetime military organization of 590,000 

personnel exceeded 1,530,000 personnel by June 1951.29 Although the 

draft provided significant manpower, political considerations encouraged 

the extensive use of indigenous labor. Korean and Japanese laborers, as 

many as 245,000 civilians, worked with 41,000 uniformed combat service 

support personnel to supply troops in the field.30 Official records note that 

“engineer construction troops, aided by great numbers of Korean laborers, 

worked to the limit of their endurance to restore the rail lines northward.”31

In 1951, the Republic of Korea (ROK) organized many of these workers into the Korean Service Corps, a “quasi-military corps that provided 

general manual labor to US Army units to which they were attached,” and 

who were under the discipline of the ROK military.32 The use of this large 

number of foreign workers under military authority encouraged Americans to conceptualize warfighting with less than full mobilization, thereby 

minimizing domestic economic and social disruption. The next major 

conflict showed this to be a misguided precedent; it also dramatically 

illustrated how conscious politicians had become of the domestic political 

costs of war. 

Political factors figured prominently in the decisions regarding 

appropriate force structure during the Vietnam War. President Lyndon B. 
16 

Johnson’s refusal to mobilize reserve units resulted in an increased reliance on contracted labor and other services. The military draft became 

extremely controversial; social mandates often filled military billets, rather 

than the best-qualified and motivated candidates.33 As a result, contractors 

routinely operated bases, provided engineering and construction services, 

water and ground transport, and maintained and repaired equipment from 

the beginning of the US involvement in 1954. 

Private enterprise adapted to this new role in Vietnam. Civilian contractors completed a greater number of construction projects in combat 

areas, and technical experts deployed alongside regular armed forces to 

support battlefield technology. Prior to the arrival of the US Corps of 

Engineers in mid-1965, US construction capability in Vietnam consisted 

of a contracted civilian force under the direction of the Navy. In a study of 

base development, Lieutenant General Carroll H. Dunn concluded: “the 

construction program was probably the largest concentrated effort of its 

kind in history. One feature of the program was unique. Because engineer 

troops were few at the beginning, contractors and civilian workmen for 

the first time in history assumed a major construction role in an active 

theater of operations.”34 In addition, more companies deployed civilian 

field service technicians for the increasingly complex technology in use on 

the battlefield.35 In all, a Joint Logistics Review Board later noted that 35 

American companies deployed in support of military units in Vietnam.36

Companies reorganized their corporate structure to profit from the new 

demand for military support. Several large companies organized into consortiums to accomplish the work. Brown and Root joined with the J.A. 

Jones Corporation to form BRJ. In 1965, Raymond International and MorisonKnudsen united to form RMK-BRJ, a consortium that built airfields, ports, 

bridges, ammunition depots, utilities, and fuel storage, maintenance, and 

medical facilities on contracts valued in excess of $2 billion between 1965 

and 1972. Most of the contracts were cost plus 1.7 percent of the estimated 

costs with a possible additional .76 percent performance bonus.37 At the 

peak of their operations, RMK-BRJ employed more than 52,000 people 

at 50 locations in Vietnam. RMK-BRJ began phasing out their operations 

after 1969; slowly, Army Engineers, Seabees, Air Force construction 

forces, and Vietnamese nationals replaced company workers. 

Unlike KBR’s contracts during World War II, their work in Vietnam 

was controversial and continued amidst charges of fraud and corruption. 

A Government Accounting Office (GAO) report charged that Brown and 

Root had “lost accounting control of 120 million dollars,” and their poor 

security had contributed to the theft of goods valued at “millions” of dollars.38
17

Connecticut Senator Abraham Ribicoff called for an investigation, noting 

his belief that “federal funds (which) are now being squandered because of 

inefficiency, dishonesty, corruption, and foolishness.”39 Some competitors 

for government contracts accused their rivals of unfair business practices. 

Student protests met George Brown’s appearances at the campuses of Rice 

University and the University of Texas. In contrast, Ambassador Ellsworth 

Bunker acknowledged his assessment of the contribution of RMK-BRJ in 

1972: “The ports that were built here to move the cargoes of war can in 

the years to come support ... cargoes of commerce and world trade. The 

airfields, roads, and bridges that now bear military traffic can serve as 

lifelines for the distribution of goods and services throughout the nation. 

At a time when all too many forces are bent on destruction, RMK-BRJ’s 

ten years of accomplishment have been in my opinion one of the finest 

episodes in our nation’s history.”40 The experience in Vietnam had encouraged the Nation’s leaders to expand dramatically the role of contractors on 

the battlefield. In part, this was a product of the mechanism of American 

government that provides for its military needs. The war was controversial, and political and economic factors sometimes overshadowed a clear 

focus on military effectiveness. 

Congress has alternatively restricted and empowered presidential 

military prerogatives. In 1964, Congress authorized President Lyndon B. 

Johnson to “take all necessary measures to repel any armed attack against 

the forces of the United States and to prevent further aggression ... the 

United States is, therefore, prepared, as the President determines, to take 

all necessary steps, including the use of armed force, to assist any member 

or protocol state of the Southeast Asia Collective Treaty requesting assistance in defense of its freedom.”41 This resolution remained in force until 

terminated by a concurrent resolution of Congress. The Cooper-Church 

Amendment (1970), the first Congressional legislation to limit the deployment of troops during a war, prohibited then President Richard Nixon from 

using American military forces in Cambodia and Laos after 30 June 1970. 

Congress exerted even more influence over the use of the military with the 

Goldwater-Nichols Act of 1986, which reorganized the armed forces to 

reduce interservice frictions and to enhance their ability to conduct joint 

and multinational operations. 

Complex social, political, and economic factors, including racial 

conflict, interservice rivalries, and controversial application of military 

discipline further eroded military effectiveness after 1970. Controversial 

presidential decisions by the Johnson and Nixon administrations during 

the Vietnam War resulted in the passage of the War Powers Act in 1973. 
18 

This legislation required the commander in chief to return American 

military forces from foreign deployments within 60 days unless Congress 

authorized an extension. Covert CIA activities, such as the controversial 

Phoenix Program, encouraged congressional leaders to place limitations 

on the commander in chief and to reexamine both foreign policy and the 

means available to project national military power. Vinnell Corporation, 

not American troops, reorganized and trained the Saudi Arabian National 

Guard forces. The increased scrutiny of military operations by Congress, 

the public, and a growing number of investigative journalists created more 

demand for private security providers to supplement high profile regular 

troops. The decision to increase the use of civilian providers to support 

military operations appeared logical and practical, not only in terms of 

political expediency but also in the face of economic realities. 

Military resource management throughout the 1980s reflected new 

expectations and incorporated some of the lessons learned in Vietnam. 

Regular military units concentrated on special competencies rather than 

broad capabilities. Because the end of the national draft in 1973 required 

the services to attract recruits from a competitive job market, the soldiers, 

sailors, and airmen of the all-volunteer military expected increased benefits, retirement incentives, and higher living standards. The army restructured forces to ensure that the reserves would accompany regular units 

during any extended military action. Civilian contractors began to appear 

on military installations as the services restructured to become more 

responsive to peacetime resource allocations and other market realities.42

In 1987, the Defense Department awarded the first umbrella contract to a private corporation with the intent to provide for contingencies 

and short-term emergencies and to control unnecessary costs. LOGCAP 

required the contractor, rather than the military, to maintain the capability to receive, house, and sustain 20,000 troops in five base camps for 

180 days, with an option to extend requirements to 50,000 troops for 

360 days.43 LOGCAP has supported several military operations since 

the initial award. KBR provided dining facilities, water, laundry, petroleum, and other needed services and supplies to sustain Operation JOINT 

ENDEAVOR in Bosnia in 1995. This contractual arrangement allowed 

regular troops to concentrate on the military mission, in effect providing 

“more tooth, less tail” to the mix of forces.44 KBR became a major provider of construction projects; US Air Force (USAF) and US Navy (USN) 

construction engineers assisted contractors, which turned the original concept of augmenting regular forces on its head. In East Timor, LOGCAP 

contractor DynCorp supplied four helicopters, piloted by Russian and 
19

Bulgarian nationals, to transport an excess of 6,500 passengers and 845 

tons of cargo in 474 flight hours. To at least one logistician, this validated 

the LOGCAP concept that the US military could fulfill missions without 

“always having to use military assets directly.”45 The military relied on 

LOGCAP contracts throughout the 1990s to complete a number of missions, including military operations in Somalia, Rwanda, Haiti, Southwest 

Asia, and Italy. The companies who performed the work earned more than 

$268 million.46 Contractor support continues to play an ever-expanding 

role in military operations. 

Contractor support was crucial to Operation DESERT STORM in 

1991, although few contractor employees deployed to forward combat 

areas. The decision to deploy only US regular combat units necessitated the use of 998 employees from 76 US contractors and over 2,900 

employees of 22 foreign contracted firms.47 For the most part, US contractors provided maintenance, supply, and transportation services. Foreign 

contractors worked primarily in transportation services as providers of 

trucks, buses, and drivers (86 percent of the total). Although the force mix 

included 770 Department of the Army civilian (DAC) employees (472 

maintenance and 298 supply workers), only 34 employees—primarily 

technicians for high-tech weapons systems—from 10 US contractors 

accompanied the force into Iraq or Kuwait; no DAC employees deployed 

across the border with Army forces.48 As many as 250 logistics assistance 

representatives accompanied Army units into Saudi Arabia, Turkey, and 

Israel to maintain equipment. Additional civilians manned depot systems 

in forward positions determined by the theater commander.49

The augmentation of regular troops with contractors allowed the force 

to deploy rapidly, maximize flexibility, and maintain operational capacity 

of advanced technology. Multiple contracting agencies attempted to match 

the needs of the force with the advantages and skills of the contractors, 

with the support and infrastructure of the host nation as a fundamental 

consideration.50 Contractor logistics support allowed troop levels to stay 

under mandated strength ceilings and to increase overall combat power. 

However, a study by the Logistics Management Institute revealed serious 

problems concurrent with the extensive use of contract support.51 Command and control was difficult, commanders had poor visibility of contractors, and few military contracting officers were available to supervise 

the work. Coordination and communication through these already narrow 

channels became more difficult under combat conditions. Contractors 

operated without the crucial guidance of “commander’s intent.” Civilians 

often lacked the physical capability, training, and discipline necessary for 
20 

combat support. Language barriers contributed to poor communication. A 

study concluded: “Senior logisticians whom we interviewed were almost 

unanimous in their observations that the contractors performed an essential and vital role on the battlefield especially in supporting the high-tech 

weapons systems.” Many observed that in future conflicts, greater use of 

contractors and DACs can be expected; however, their roles would be 

“undertaken primarily in the rear areas.”52 Because this short operation 

handily achieved its limited goals, the problems seemed less important 

than the result. The extensive use of contractors continued to evolve 

beyond past proportions and, in the absence of critical examination, the 

role of PMCs became increasingly complex and undefined.

In addition to chronological eras of development, historians have 

identified a number of issues and trends that impact logistical capabilities, 

including political institutions, military personnel, management, the force 

mix, and the mobilization in modern, particularly 20th century, warfare. 

The increasing complexity of battlefield technology has elevated the 

importance of logistics in relation to the strategic and tactical concerns of 

warfare. Logistical considerations limit the strategic and operational possibilities and shape campaign planning as never before. Logistics personnel have become more specialized—to accommodate new technologies 

and management systems—and more numerous. Today’s military organizations can easily contain a higher ratio of “tail” compared to the “tooth” 

of the past. Moving and sustaining this tail became a concern in and of 

itself during expeditions and overseas deployments. 

Two overarching themes currently characterize the military management field—the process of rationalization and cyclical patterns of readiness. 

Rationalization refers to centralized planning (generally at a high DOD 

level) and systematic application of business management techniques. 

These ideas hark back to Frederick Taylor’s “time and motion” studies 

during the late 19th century, where Taylor examined industrial production 

to determine the most efficient ways of producing manufactured goods. In 

1903, Secretary of War Elihu Root found military applications for Taylor’s 

management techniques. This trend continued with attention to statistical controls during World War I, grew into the applications of “systems 

analysis” in the 1960s, and later became operations research. The second 

element, cyclical patterns of readiness, refers to the tendency—first noted 

by Emory Upton in the 19th century—of the US to demobilize and deemphasize military expenditures and modernization until the next conflict 

begins and the demand for military power is immediate. Upton referred to 

this phenomenon as “chronic unpreparedness,” although the process more 
21

closely resembles a continuing cycle. While many of today’s military historians and analysts insist that the US has maintained a more ready posture 

since the close of World War II, the end of the Cold War in 1991 signaled 

a period of massive demobilization. 

The composition of the force mix and mobilization concerns represents another area where change is evident. Civilians working for PMCs, 

rather than as Department of the Army (DA) or DOD personnel, make 

up a greater percentage of today’s force. The tendency toward coalition 

warfare has led to the concept of host nation support. Often, however, the 

US military operates in a complex logistical environment that requires it 

to provide support for its coalition partners and PMCs. What is significant 

here is that before the Vietnam conflict, PMCs were used more or less as 

a matter of necessity, rather than what later became a routine design feature of the force mix. Current doctrine accepts the support of contractors 

and coalition partners as an integral component of military operations. 

In addition, the rapid tempo of current military operations often requires 

rapid deployment. The geographical requirement to project military power 

across the globe increases the complexity, scale, and scope of logistical 

support.

Although the face of warfare had changed dramatically since the 

American Revolution, crucial aspects of the process remained clear and 

consistent throughout Operation DESERT STORM. PMCs played significant but limited roles on the battlefield. Their legal status was clearly 

defined as a noncombatant and their purpose was to support regular and 

reserve units conducting military operations. Military officials contracted 

PMCs for transportation, supply, labor, and engineering needs in areas 

adjacent to or outside of active theaters; the jurisdiction of the UCMJ 

extended to civilians employed to support military operations. Congress 

attempted to stem corruption and waste with careful planning, standardized contracts, and appropriate levels of government supervision. 

Efficiency was generally the top priority of peacetime, and, as a result, 

effectiveness—particularly early in war—fluctuated. The US government 

financed war from a broad tax base and extracted manpower, when necessary, through a mandatory draft.

There are strong indications, however, that American military institutions and civil-military relations may be entering a new phase. While the 

nature of this change will unfold over time, current practice deviates significantly from previous patterns. Past decisions have eroded established 

military traditions, structure, and many legal processes created in the earlier 

phase. While soldiers have specialized training programs and maintain 
22 

strict professional standards, they are also experiencing a number of 

career changes throughout their 20 plus years of service. This may tend to 

produce soldiers that are more generalized practitioners in the art of war. 

Integration takes on new meanings as coalition warfare changes the face 

of American military operations and the incorporation of a high number of 

PMCs into the force mix eclipses the participation of DA civilians.

In many ways, the Vietnamese conflict represented a transition in 

American warfare. The clear roles, disciplinary procedures, and operational areas of PMCs began to blur. Contractors filled shortfalls in a 

limited, all-volunteer force structure. Policy makers reversed the very 

rationale for using PMCs—to augment short-term voids in the regular 

military force structure—as PMCs became primary repositories of capabilities supported as necessary by uniformed troops. The 1990s, however, 

represents a watershed decade for change. As a result, PMCs are so vital 

to current military operations that industry analysts suggest the US can 

no longer go to war without private contractor support. The elements of 

past success in wartime mobilization—centralized planning, production, 

and delivery; reliance on domestic sources; independent military organizational and command structures; adequate oversight; focus on military 

effectiveness; and reliance on the draft from a broad segment of American 

society—no longer applies.
23

Notes

1. Martin van Creveld, Supplying War: Logistics from Wallenstein to 

Patton (Cambridge: Cambridge University Press, 1977).

2. See also James A. Huston, The Sinews of War: Army Logistics, 1775-

1953 (Washington, DC: Office of the Chief of Military History, US Army, 1966); 

Russell F. Weigley, The History of the United States Army (New York: Macmillan, 

1967).

3. John A. Lynn, ed., Feeding Mars: Logistics in Western Warfare from the 

Middle Ages to the Present (USA: Westview Press, 1993), 37.

4. Charles Shrader, “Logistics,” in Fred Anderson, et al., eds., The Oxford 

Companion to American Military History (New York: Oxford University Press, 

1999), 399-402.

5. Ibid., 400. See also Richard Kohn, Eagle and Sword: The Federalists 

and the Creation of the Military Establishment in America, 1783-1802 (USA: 

The Free Press, 1975). 

6. Huston, Sinews of War, 29; much of the historical summary to follow is 

based on his most useful work.

7. Charles R. Shrader, “Contractors on the Battlefield,” Landpower Essay 

Series 99-6 (Arlington, VA: AUSA Institute of Land Warfare, May 1999), 

<www.ausa.org> (28 October 2004).

8. John Shy, “Logistical Crisis and the American Revolution: A 

Hypothesis,” in Lynn, Feeding Mars, 163.

9. Huston, Sinews of War, 99.

10. Ibid.

11. Shy, “Logistical Crisis,” in Lynn, Feeding Mars, passim.

12. Huston, Sinews of War, passim; see also Steven J. Zamparelli, 

“Contractors on the Battlefield: What Have We Signed Up For?” Issues and 

Strategy 2000, Contractors on the Battlefield (Air Force Logistics Management 

Agency, December 1999), 10. 

13. Shrader, “Contractors on the Battlefield,” 4.

14. Huston, Sinews of War, 129.

15. Shrader, “Logistics,” American Military History, 399-402.

16. Webster’s II New Riverside University Dictionary (USA: Riverside 

Publishing Company, 1984), 1076.

17. Shrader, “Contractors on the Battlefield,” 5.

18. Ibid., See also Zamparelli, “Contractors on the Battlefield ...” Issues and 

Strategy 2000.
24 

19. R. Elberton Smith, US Army in World War II: The Army and Economic 

Mobilization (Washington, DC: Center of Military History, 1985), 220.

20. Ibid., 219.

21. Lida Mayo, The Ordnance Department: On Beachhead and Battlefront

(Washington, DC: Office of the Chief of Military History, US Army, 1968), 20-21, 

quoted in Shrader, 7.

22. Smith, US Army in World War II, 234.

23. Ibid., 221.

24. Ibid., 485.

25. Robert M. Friedman, “Civilian Contractors on the Battlefield: A 

Partnership with Commercial Industry or Recipe for Failure?” (Carlisle Barracks, 

PA: US Army War College, 2002), <http://handle.dtic.mil/100.2/ADA404511> 

(4 July 2005).

26. Shrader, “Contractors on the Battlefield,” 6. See also John W. Swancara, 

Project 19: A Mission Most Secret (Spartanburg, SC: Honoribus Press, 1996).

27. Ibid.

28. Huston, Sinews of War, 650, 645.

29. Terrence J. Gough, U.S. Army Mobilization and Logistics in the Korean 

War: A Research Approach (Washington, DC: Center of Military History, 1987), 

12.

30. Huston, Sinews of War, 646.

31. Roy E. Appleman, US Army in Korea: South To The Naktong, North To 

The Yalu (June-November 1950) (Washington, DC: Office of the Chief of Military 

History, 1961), 639.

32. Gough, U.S. Army Mobilization and Logistics in Korea, 12-13.

33. A prominent example is Project 100,000, a mandate that required the 

military services to accept candidates for basic training and service that did not 

meet current educational and physical standards and capabilities.

34. Carroll H. Dunn, Vietnam Studies: Base Development in South Vietnam, 

1965-1970 (Washington, DC: Department of the Army, 1991), 3, <http://

www.army.mil/cmh/books/vietnam/basedev/index.htm> (7 July 2004). 

35. Friedman, “Civilian Contractors,” 12.

36. Dunn, Vietnam Studies.

37. Joseph A. Pratt and Christopher J. Castaneda, Builders: Herman and 

George R. Brown (College Station: Texas A&M University Press, 1999), 239.

38. Ibid., 240-241.

39. Ibid., 240.
25

40. Ibid., 239-240.

41. Gulf of Tonkin Resolution, Public Law 88-408; 78 Stat. 384, <http:

//www.uiowa.edu> (28 January 2005).

42. James Kitfield, Prodigal Soldiers (New York: Simon and Schuster, 

1995).

43. US Army Regulation 700-137, Logistics Civil Augmentation Program 

(LOGCAP) (Washington, DC: Headquarters, Department of the Army, 16 

December 1985). 

44. Herman T. Palmer, “More Tooth, Less Tail: Contractors in Bosnia.” 

Palmer asserts “civilian contractors ... are not totally interchangeable with their 

well-trained military counterparts,” <http://www.almc.army.mil/alog/issues/

SepOct99/MS408.htm> (26 August 2004).

45. James Folk and Andy Smith, “A LOGCAP Success in East Timor,” <http:

//www.almc.army.mil/alog/issuesJulAug00/MS566.htm> (26 August 2004).

46. David R. Gallay and Charles L. Horne, “LOGCAP Support in Operation 

Joint Endeavor: A Review and Analysis” (McLean, VA: Logistics Management 

Institute, 1996), 10, <http://nwc.navy.mil/library> see also <http://www.1mi.org/

scripts/> (4 July 2005).

47. George B. Dibble, Charles L. Horne III, and William E. Lindsay, Army 

Contractor and Civilian Maintenance, Supply, and Transportation Support 

During Operations Desert Shield and Desert Storm, Volume 1: Study Report

(Bethesda, MD: Department of Defense, 1993), 3-45, 2-1, 2-2.

48. Ibid., 2-2, 2-4, iv, 2-6.

49. Craig A. Simonds, “The Role of Civilians During the First Gulf War,” 

<http://www.almc.army.mil/alog/issues/JanFeb04/RoleofCivilians.htm> (26 August 2004).

50. Dibble, et.al., Army Contractor and Civilian...During Operations Desert 

Shield and Desert Storm, 2-1.

51. Ibid.

52. Ibid., iv.
27

Chapter 3

Operations IRAQI FREEDOM and ENDURING FREEDOM

Political restructuring during the 1990s produced trends that drastically altered the American “way of war.”1

 The political instability 

triggered by the collapse of the Soviet Union allowed for the violent 

expression of many existing ethnic and religious conflicts, spurring the 

demand for private security and increased military support services. 

Weapons stockpiles fueled conflict with inexpensive and available arms. 

Americans interpreted a reduced threat to national security that would 

result in a “peace dividend,” or an accelerated reduction of military size 

and expenditures. This decrease in American forces by as much as onethird created an ample supply of skilled workers to fill the demand for 

increased paramilitary services.2 Moreover, PMCs assumed many staff 

and other routine duties formerly performed by uniformed personnel and 

DOD civilian employees. Although the United States remained the dominant international military power, many politicians and citizens looked to 

other instruments of conflict resolution and national power—diplomatic, 

political, and economic—to achieve American foreign policy goals and 

responsibilities.

 Economic restructuring also dramatically altered the conduct of 

military operations. Many policy makers theorized that privatization and 

private management of public assets would increase efficiency while 

reducing both the size and cost of government. The move toward privatization, began by President Eisenhower in the 1950s, gathered momentum 

and support. By 2000, declining government receipts, burgeoning deficits, 

and an emphasis on peacetime efficiency encouraged the policy change 

and intersected favorably with the historical tendency of the US to rely 

more heavily on private assets in times of reduced mobilization and during 

lower levels of perceived threat.

However, privatization blurred the roles of public and private sectors. 

Officials have used the term “inherently governmental” functions to 

define essential services that specialized government employees should 

manage to maintain the public trust. Some analysts define military 

functions as inherently governmental, because military defense should 

not be a function of the market economy. In contrast, business managers 

use outsourcing, privatization, and other market-based techniques to 

improve cost-efficiency and to optimize production thereby maximizing 

profit. Government services focus on national strategy goals, while private 

military companies stress profit and growth. Thus, differences in function, 
28 

goals and objectives, and methods of management create boundaries 

between public and private responsibilities. 

The global marketplace encouraged diverse methods of business 

management. Three management techniques contributed to a competitive 

climate—privatization, outsourcing, and timed production and delivery. 

Privatization, frequently encouraged to reduce the overhead and growth of 

the federal government, involves exploring the cost efficiency of delegating specific governmental functions to private businesses. The competition 

fostered by such initiatives, in theory, can reduce costs and provide more 

effective customer service. Beginning in 1955, the Eisenhower administration encouraged federal agencies to rely on the private sector to limit 

government expansion and to manage resources efficiently. The Office of 

Management and Budget (OMB) provided written guidance for the competitions in Circular A-76 in 1966; OMB has since revised the process 

while retaining the central goal of cost efficiency. Under the regulation, 

federal agencies can contract commercial activities by direct conversion 

(under prescribed circumstances) or after completion of a cost comparison 

analysis that allows government employees to compete with private sector providers. The Reagan administration encouraged A-76 studies and 

established the President’s Commission on Privatization to “review the 

appropriate division of responsibilities between the federal government 

and the private sector.”3 In 1995, congressional and presidential initiatives 

and declining budgets encouraged government agencies to revisit the issue 

of privatization. Supported by the Clinton administration, the Department 

of Defense completed A-76 studies on approximately 10,660 positions in 

fiscal years 1995-99.4 The (George W.) Bush administration continued to 

advocate competitive sourcing studies to achieve maximum cost efficiency 

and accountability in government management.5 Critics charge that many 

A-76 studies neglect to address the finding that a bidding process focused 

on cost-efficiency through competition and efficient management can fail 

to produce similar quality or equivalent customer service. 

Outsourcing allows the government (or other business entity) to 

retain greater influence over the service or product, but refers a specific 

portion of the work to an outside entity or subcontractor. Military outsourcing utilizes private businesses to complete specific responsibilities, 

particularly staff and clerical work. The uniformed personnel replaced 

are available for other missions. Significant cost reductions accrue from 

lower training, benefit compensation, retention incentives, and retirement 

costs. Moreover, outsourcing allows the contracting organization and 

the contractor to maximize resources and stress excellence in their core 
29

competencies. Privatization and outsourcing are controversial practices 

because they can involve contracts with business entities that exploit 

labor by neglecting safety standards and fair labor practices. Despite the 

controversy, privatization and outsourcing continue to be widely accepted 

business practices. 

Another common management technique aims to eliminate waste by 

controlling the flow processes of manufacture (or acquisition) to assure 

delivery when needed. Managers can reduce production and storage 

costs, in addition to controlling the marketing of their product. Toyota 

Corporation developed this management technique (first known as the 

Toyota Production System or TPS) and applied it to their Japanese factories in the 1950s; manufacturers in the United States began using the 

concept of “just-in-time” delivery in the 1980s.6 Military officials apply 

this concept as “focused logistics [that] provides the right personnel, 

equipment and supplies in the right quantities and at the right place and 

time.”7 The development of new communications technology, especially 

the extensive use of the Internet for business applications, has made the 

practice of controlled production and delivery standard procedure for the 

global economy.8 The military applications of privatization, outsourcing, and focused logistics profoundly affected operations throughout the 

1990s.

The role of contractors in Operation ENDURING FREEDOM (OEF) 

and Operation IRAQI FREEDOM (OIF) is a significant departure from 

past experience, even from the recent past of Operation DESERT STORM. 

While contractors played a continual role supporting US troops from the 

opening shots of the American Revolution, by 2003 military contractors 

commanded an ever-expanding share of the force mix. A recent study of 

2.2 million contracts from 1998 to 2003 indicated that DOD spent half 

of their budget on private contractors. Service contracts accounted for 56 

percent of the total amount spent.9 More than 20,000 employees currently 

work in a nonlinear theater of military operations that risks not only their 

personal safety, but also that of the troops they accompany, as well as 

an undetermined number of foreign nationals.10 These workers perform 

a variety of military services including construction, security, training, 

maintenance of facilities and equipment, logistical support, transportation, 

and maintenance of information technology capabilities. Industry experts 

assert that as many as 30 companies working in these two theaters of war 

are foreign-owned; in addition, over 60 US corporations are present.11 

The diverse needs of the OIF and OEF theaters require mobilized 

assets from a mix of public and private sources. While the traditional 
30 

function of military forces is warfighting, current practice requires soldiers, marines, sailors, and airmen to be statesmen, humanitarians, police, 

interpreters, and fulfill additional roles as needed. The scope of current 

missions requires competencies sometimes in short supply within the military ranks. Civilian employees and contractors are often tapped to fill the 

gaps, although doctrine requires regular forces to maintain independent, 

long-term support capabilities.12 Cost savings can accrue by utilizing the 

special training and experience of corporations with the infrastructure 

development, corporate organization, and capability to deliver a wide 

range of service support quickly. 

The largest sector of the PMC industry is employed in base operations, construction, and other combat support services. A recent study 

by a consortium of investigative journalists indicated that two services 

organizations held 2,700 of the 3,061 contracts awarded by DOD from 

1994 to 2002. KBR employs over 24,000 workers in Iraq to conduct a 

variety of civil and military construction projects, in addition to operating 

60 dining facilities for US military personnel.13 KBR has a long-standing 

relationship with government contracting that stems from World War II, 

when many officials considered them to be “the” government contractor 

for a variety of engineering, construction, operations and maintenance, 

and logistics services. Despite recent allegations of some improprieties, 

KBR is a leading government contractor in Iraq and Afghanistan, earning over $11.4 billion from government contracts from 2002 to July 

2004.14 KBR’s parent organization, Halliburton, is familiar with military 

operations in the Middle East; the US government hired the company to 

extinguish oil well fires ignited during the first Gulf War. Vice President 

Richard Cheney, Halliburton’s former CEO, remarked, “The first person 

to greet our soldiers as they arrive in the Balkans, and the last one to wave 

goodbye is one of our employees.”15 Booz Allen Hamilton has worked 

closely with the US military since 1940, and, in addition to their traditional 

construction and combat support services contracts, they currently provide 

employees that work in strategic planning, engineering and architectural 

services, information technology and systems development, wargaming, 

policy analysis, economic and business analysis, and logistical planning 

and analysis positions.16

Private corporations offer a full range of provider, consultant, and 

support functions in OIF and OEF. Security details comprise the majority 

of the provider contracts. DynCorp, a service company that operates in 15 

different industries, provides a security detail for Afghan president Hamid 

Karzai valued at $52 million in fiscal year 2003. Erinys International 
31

protects Iraqi oil pipelines for $39.2 million, an effort that requires over 

14,500 security guards.17 CusterBattles, a corporation that operates in 70 

countries and employs 1,200 people, has provided security for Baghdad 

International Airport since June 2003.18 Thousands of civilian employees 

now perform many duties formerly assigned to military units.

Consultant firms are numerous and offer many capabilities. In 2003, 

Vinnell Corporation earned a $48 million contract to train the new Iraqi 

National Army.19 Vinnell’s website traces their involvement in the industry from 1975, when they “embarked on a precedent-setting project for a 

civilian firm—the training, logistical support, and complete modernization of the Saudi Arabian National Guard.”20 Vinnell, now a subsidiary of 

Northrop Grumman, has broad capabilities including the operation and 

maintenance of military bases in Europe, the Middle East, and the United 

States. CACI International, with over 9,400 employees worldwide, operates military computer systems in Iraq, collects and analyzes data, and 

employs interrogators under a contract valued at $19.9 million dollars.21

Computer Sciences Corporation (CSC), a prominent information technology services provider, earned $14.9 billion in fiscal year 2004. Forty-three 

percent of CSC’s business revenues derived from government contracts in 

2004—DOD was their largest single government customer. CSC claims 

to have served “virtually every agency and department of the Federal 

government worldwide” for over 25 years, with $6 billion in annual revenue and over 40,000 employees in 750 locations.22 Blackwater Security 

Consulting, founded in 1996, provides firearms and security training for 

law enforcement and military organizations. One of their most recent contracts involved training Iraqi police and military units.23

Many firms perform service or support in more than one functional 

area. CusterBattles’ advertises services that range from humanitarian 

disaster relief to “kidnap and ransom support.”24 Aegis Defense Services 

currently provides security for the US Project Management Office in 

Iraq, in addition to management of private sector contractors engaged in 

reconstruction.25 Titan Corporation, one of the largest suppliers of translators in Iraq, also provides equipment and technology services to government agencies including the military, NASA, and the Federal Aviation 

Authority.26

Contractors work for a number of governmental agencies and nongovernment organizations with humanitarian and political, rather than military, priorities—primarily the US Agency for International Development 

(USAID) and the US State Department. In April 2003, USAID awarded a 

$43 million contract to Abt Associates for medical equipment and training 
32 

of the Iraqi Health Ministry. American President Lines, Ltd. earned nearly 

$5 million for emergency ocean freight services in April and June of 2003. 

In FY 2003 DynCorp (acquired by CSC) earned a $50 million contract 

from the State Department to provide support to Iraqi law enforcement 

agencies.27 

For the most part, these companies fulfill their contractual obligations in 

volatile and unsafe environments. Not surprisingly, the absence of political 

authority often exposes contractor employees to hostile military action. 

The insurgents are asymmetrical forces, not signatories to international 

or regional agreements, and use violence and the threat of violence to 

deter public cooperation with authorities. The highly publicized deaths of 

four employees of Blackwater USA in Fallujah in March 2004 and recent 

incidents of beheadings tragically illustrate the personal risks assumed 

by many contractor employees. By mid-2004, reports noted at least 50 

deaths and 300 wounded civilian employees in Iraq and Afghanistan.28

More recent figures from the US Labor Department observed a 93-percent 

increase in US contractor deaths during the fourth quarter of 2004, with 

over 232 workers killed in Iraq and an average of 22 attacks on sites, 

employees, and construction projects per week.29 Contractors working in 

other world regions also assume these risks. Marxist rebels have held three 

American civilians employed for a subsidiary of Northrop Grumman in 

Columbia as hostages for over a year.30

Many employees are willing to accept the uncertainty associated 

with civilian work in war-torn regions. The pay can be two to ten times 

higher than that received by comparable military personnel. Former 

members of the Green Berets or special operations forces may make as 

much as $30,000 per month.31 Large private military corporations such as 

Halliburton routinely recruit at job fairs, many held near military bases. 

Compensation averages $80,000 to $100,000 annually to ex-soldiers and 

marines, who utilize their military training and experience acquired and 

honed by their years of government service.32 Most of this pay ($80,000 

if deployed over 330 days) is tax free. In contrast, senior enlisted special 

operations forces earn around $50,000 annually.33 Halliburton reports 

employing around 300 people each week from their database of 100,000 

resumes.34

The legal status of civilian workers supporting US military operations 

is frequently unclear. Many host nations enter into Status of Forces 

Agreements (SOFAs) that determine the legal status of US citizens 

within their boundaries. In the absence of SOFA, the Hague (1907) and 

Geneva Conventions (1949 and subsequent) apply to US actions during 
33

international armed conflicts between signatories. The US military issues 

identification cards to PMC employees that designate their status as 

noncombatants or civilians authorized to accompany military forces in the 

field. Nevertheless, PMC employees that accompany US Armed Forces 

“may be subject to hostile action.”35 Many of these civilians currently 

work in areas where there is weak political authority, belligerents who do 

not recognize international law, and perform their duties during military 

operations other than war (MOOTW) or stability and support operations 

(SASO). Thus, if captured, they are not assured the protections of POW 

status. The ambiguous legal status of civilians on the battlefield is only one 

complex issue that commanders currently face. 

Military planners must synthesize, prioritize, and apply a complex 

system of guidance. Title X of the US Federal Code authorizes the military 

to maintain core capabilities as determined by the Secretary of Defense. 

National strategies, defined by the executive branch, set military goals 

and objectives. From this guidance, the military establishes joint and 

individual service regulations that outline the policies, responsibilities, 

and procedures of each service branch. Field manuals (FMs) provide additional guidance based on regulations. Proponent agencies with the proper 

authority issue revisions or exceptions, generally in the form of policy 

statements. Parameters, Military Review, and other service publications 

offer direction from the experience of field officers. The entire US Federal 

Code, ranging from acquisition regulations to criminal statutes, applies at 

all stages of the contracting process. 

National strategy is the first level of doctrinal control that gives purpose to the use of military power as an element of national power. These 

documents, to include the National Security Strategy and the National 

Military Strategy, have increasing relevance to the military community 

and determine what resources political leaders will make available to 

military institutions. Military officers must establish and interpret regulations to implement this guidance from the nation’s political leaders. 

Currently, a complex body of Army regulations (ARs), field manuals, and 

policy statements have evolved over time, beginning with AR 700-137, 

Logistics Civil Augmentation Program (LOGCAP), to “preplan[s] for 

the use of civilian contractors to perform selected services in wartime to 

augment Army forces.”36 LOGCAP initiated a method to provide combat 

support and combat services support, primarily in support of contingency 

operations and rapid deployment. The first LOGCAP contract reimbursed 

KBR’s costs plus a guaranteed 2 to 5 percent of cost fee for services. 

Although DynCorp won the second LOGCAP contract, KBR retained the 
34 

Balkans operations support (1995–present), and the company earned the 

entire 2001 LOGCAP contract that is renewable for 10 years.37 The US 

Air Force has a similar policy, Air Force Contract Augmentation Program 

(AFCAP), to provide limited base operating support as it becomes necessary.38 The US Navy’s Contingency Construction Capabilities (CONCAP), 

although more focused on construction activities, utilizes preplanning that 

can incorporate contractor capability to support regular forces.39 Officials 

continue to consider the possibility of converting additional regular military positions to civilian workers, especially in peacetime, to check unwarranted military growth and expenditures.40

As contractors proliferated during military deployments, the 

Army established more specific guidance.41 AR 715-9, Contractors 

Accompanying the Force, explains the concept of contractor support, 

establishes policies and procedures for the use and management of contractors in operational areas, and designates the responsibilities of Army 

commands, contractors, and US citizens employed by contractors. The 

Deputy Chief of Staff for Logistics (DCSLOG) is the proponent agency 

of this regulation. The regulation states that contractor employees “shall 

be designated to a military unit to maintain administrative oversight and 

accountability” and must “obey general orders and force protection rules.” 

Operational plans must include contractor support. Only the contracting 

officer or his or her representative can revise or modify existing contracts. The regulation requires that contractor “personnel will be assigned 

duties at Echelons-Above-Division”; contractor personnel will not “command, supervise, administer, or control Army or Department of the Army 

Civilian (DAC) personnel”; nor shall contractor personnel be “supervised 

or directed” by military or DAC employees. Regulations do not authorize 

contractors to wear military uniforms other than safety equipment, and 

prohibits them from “any role that could jeopardize their status as civilians 

accompanying the force.” They may also be subject to local laws or other 

criminal jurisdictions.42 Together, AR 700-137 and AR 715-9 provide the 

foundation for the relationship between contracted firms and Army commands.

As the role of PMCs expanded, field manuals and Department of the 

Army Policy Memorandum also directed planning officials. FM 100-10-

2, Contracting Support on the Battlefield, and FM 3-100.21, Contractors 

on the Battlefield, are the current relevant doctrinal manuals. The former 

refers to the appropriate DOD policy and National Strategy as foundational guidance for deriving the “most effective mix of the total force” and 

stresses the advantages contractors can offer the field commander. The 
35

manuals describe the influences on the ability to utilize contractor support, including the type of contingency and the maturity of the operational 

environment. Appropriate risk assessments should determine if contractor support is feasible, and field manuals should refine the definitions of 

the responsibilities associated with the use of contractors, including force 

protection, planning, management, and integration.43 The two field manuals, Army regulations, and policy memorandum provide an overview of 

procedures that govern contractors accompanying military forces. 

Many industry analysts, politicians, and military planners insist that 

the presence of contractors on the battlefield will continue to escalate. 

President Bush and Defense Secretary Donald Rumsfeld are advocates 

of competitive sourcing. Michael P. Peters, a career Army officer and the 

Executive Vice President of the Council on Foreign Relations, observed, 

“It’s a virtual necessity, ... to outsource .... There’s no turning back 

from this, because of the nature of the Army and the nature of the tasks 

it has to do.”44 FM 3-100.21 observes: “the increasingly hi-tech nature 

of our equipment and rapid deployment requirements have significantly 

increased the need to properly integrate contractor support into all 

military operations ... the future battlefield will require ever increasing 

numbers of often critically important contractor employees.”45 FM 100-

10-2 maintains that “Contracting is an integral part of supporting Army 

forces.”46 Despite the prevalence of these convictions, the decision to 

incorporate a high proportion of contractors into the force mix is neither 

static nor irrevocable. The hard lessons of war will determine if the 

current policy and practical experience serves the taxpayer, the soldier, or 

the American public. The quality of American soldiers, marines, sailors, 

airmen, and reserve components have made it a foregone conclusion that 

US forces will accomplish each and every assigned mission. As a result, 

the bottom line—military effectiveness—is perhaps the least considered 

factor in determining who fights for American interests. 
36 

Notes

1. Russell F. Weigley, The American Way of War: A History of United States 

Military Strategy and Policy (Bloomington: Indiana University Press, 1973).

2. Selected Manpower Statistics, Department of Defense, <http://www. 

dior.whs. mil> (6 December 2004).

3. Ronald Reagan, Executive Order 12607, The President’s Commission on 

Privatization, <http://www.reagan.utexas.edu/resource/speeches/1987/090287c. 

htm> (10 December 2004).

4. US General Accounting Office, “DOD Competitive Sourcing,” GAO01-20, December 2000, 6.

5. George W. Bush, The President’s Management Agenda, <http://www. 

whitehouse.gov/omb/> (10 December 2004).

6. R. Jacobs, “Just-in-Time Lecture Notes,” <http://personal.ashland.edu/

~rjacobs/m503jit.html> (9 August 2004), based on Richard J. Schonberger, 

“Just-in-Time Production Systems: Replacing Complexity With Simplicity in 

Manufacturing Management,” Industrial Engineering, October 1984, 52-63.

7. Richard B. Myers, National Military Strategy of the United States, 16, 

<http://www.bits.de/NRANEU/docs/NMS2004.pdf> (3 January 2005). 

8. Schonberger, “Just-in-Time Production Systems: Replacing Complexity 

With Simplicity in Manufacturing Management,” 52-63.

9. Larry Makinson, “Outsourcing the Pentagon: Who Benefits from the 

Politics and Economics of National Security?” The Center for Public Integrity, 29 

September 2004, <http://www.publicintegrity.org/pns> (27 December 2004). See 

also Matthew Weinstock, “Booming Business in Selling Services,” Government 

Executive, 1 August 2001, <http://www.govexec.com/top200/01top/s1.htm> (26 

August 2004); Amelia Gruber, “Growth Industry,” Government Executive, 15 

August 2004, <http://www.govexec.com/features/0804-15/0804-15s1.htm> (26 

January 2005).

10. Esther Pan, “Iraq: Military Outsourcing,” 20 May 2004 interview with 

Michael P. Peters and Peter W. Singer, Council on Foreign Relations, <http://

www.cfr.org/background/background_iraq_outsourcing.php> (9 November 2004).

11. Ibid.

12. Title X of the Federal Code.

13. Pan, “Military Outsourcing.”

14. “Windfalls of War,” The Center for Public Integrity, <http://www. 

publicintegrity.org/wow/resources.aspx?act=total> (27 September 2004). This 

website contains a wealth of information obtained by investigative journalists; 

however, one must take care to interpret this data. A particular case in point is the 

listed contract values, which the website note codifies with “Because of inconsistent 
37

and, sometimes scarce, information provided by the US government, the amounts 

in the ‘contract values’ field represent several type [sic] of contract payouts.” The 

important point here is that, while we have some indications of problem areas, 

we do not have accurate information to adequately assess the benefits and costs 

of many contract activities. More information needs to be gathered from a variety 

of sources and both the industry and their client government agencies should 

achieve greater visibility of contracting activity. See page 20 of the report at <http:

//www.publicintegrity.org/wow/bio.aspx?act=pro&fil+IQ> (17 August 2004).

15. Singer, Corporate Warriors, 136, as quoted in Tom Ricks and Greg 

Schneider, “Cheney’s Firm Profited from Overused Army,” Washington Post, 9 

September 2000, 6.

16. Booz Allen Hamilton website, <http://www.boozallen.com> (27 

December 2004).

17. Matthew Quirk, “The List: Private Military Contractors, A 

Buyer’s Guide,” The Atlantic Monthly Online, September 2004, <http://

www.theatlantic.com/doc/prem/200409/quirk> (17 August 2004).

18. CusterBattles website, <http://www.custerbattles.com> (27 December 

2004).

19. Quirk, “Private Military Contractors.”

20. Vinnell Corporation company website, <http://www.vinnell.com/> (29 

October 2004).

21. Quirk, “Private Military Contractors.”

22. Computer Sciences Corporation (CSC), company website, “CSC 

Factbook,” October 2004, <http://www.csc.com/industries/government/mds/

mds81/121. shtml> (29 October 2004).

23. Blackwater USA corporate website, <http://www.blackwaterusa.com> 

(3 May 2005).

24. CusterBattles website, <http://CusterBattles.com> (17 December 2004).

25. Quirk, “Private Military Contractors.”

26. Pan, “Military Outsourcing.”

27. Peterson, “Windfalls of War,” The Center for Public Integrity. 

28. Pan, “Military Outsourcing.”

29. From US Department of Labor Statistics, The Associated Press, “Report: 

232 U.S. Civilian Employees Killed in Iraq,” 31 January 2005, <www.CNN.com> 

(31 January 2005).

30. Ibid.; James Dao, “Private U.S. Guards Take Big Risks for Right Price,” 

New York Times, 2 April 2004. See also Singer, Corporate Warriors.

31. Ibid.
38

32. Rick Rogers, “Ex-Marines See a Chance For Big Payday With Job in 

Iraq,” San Diego Union-Tribune, 20 October 2004, <http://ebird.afis.osd.mil/

ebfiles/s20041021330827.html> (22 October 2004).

33. Eric Schmitt and Thom Shanker, “Six-Figure Salaries Luring Special 

Forces Into Civilian Jobs,” New York Times, 30 March 2004.

34. Ibid. 

35. US Army Field Manual 100-10-2, Contracting Support on the Battlefield

(Washington, DC: Headquarters, Department of the Army, 4 August 1999), iv. 

36. AR 700-137.

37. Peterson, “Windfalls of War,” The Center for Public Integrity. Critics 

charge this lack of competition creates the exact situation that competitive 

sourcing was designed to correct. 

38. See <http://www.afcap.com/> (4 July 2005), which describes the 

mission of AFCAP as: “The Government and Private Industry team up to 

provide cost-effective, responsive solutions to meet the realities of today and the 

challenges of tomorrow.” 

39. See <http://www.almc.army.mil/alog/issues/JanFeb03/MS870.htm> 4 

July 2005.

40. This brief analysis is not intended to be a legal analysis, but rather a 

review of pertinent regulations that govern the process as a starting point for 

further research. The most salient point is that the guidance and regulations 

provided to military planners is complex, detailed, and requires extensive training 

and experience to master. 

41. Patrick T. Henry, Memorandum, Subject: Intelligence Exemption 

(Washington, DC: Memorandum from the Assistant Secretary of the Army, 26 

December 2000), <http:store.publicintegrity.org/wow/docs/25-d_Intelligence. 

pdf> (18 January 2005).

42. US Army Regulation 715-9, Contractors Accompanying the Force

(Washington, DC: Headquarters, Department of the Army, 29 October 1999), 10, 

11-12, 14, 15.

43. FM 100-10-2, 1-1, 1-15, 2-10, 3-8. 

44. Pan, “Military Outsourcing.” 

45. US Army Field Manual 3-100.21, Contractors on the Battlefield

(Washington, DC: Headquarters, Department of the Army, 3 January 2003), 

Preface. See also Simonds, 3.

46. FM 100-10-2, 1-16.
39

Chapter 4

The Future of PMCs During US Military Operations 

The current role of private enterprise on the battlefield in providing a broad range of military support services in virtually any location, 

especially inside active theaters, deviates significantly from any previous 

experience. Several factors affect the decision to incorporate a greater 

number of PMCs into the force mix and represent economic, political, 

and experiential considerations. A close examination of the challenges 

American policy makers and military leaders face when integrating PMCs 

into the force mix reveals four areas that are particularly controversial and 

problematic: First, officials have yet to establish clearly the cost efficiency 

of the current levels of PMC participation on the battlefield. Second, 

the ability of PMCs to contribute to both short- and long-term military 

effectiveness is uncertain. Third, unresolved legal issues detract from 

American credibility and influence with the fledgling authorities of many 

war-torn and unstable regions, making political and civil objectives more 

difficult to achieve. Fourth, because war impacts society, often profoundly, 

conscientious leaders must consider the social consequences of the current policy, particularly in view of a changing civil-military relationship. 

In short, policy makers cannot live only for the present. Officials must 

resolve troubling ambiguities in four broad areas—cost efficiency, military effectiveness, legal status (individual and contractual), and consider 

possible consequences for society as well as to the future force—if the US 

military is to retain the capabilities necessary to maintain national security 

and contribute to society’s well being.

Theory and research support the cost efficiency of support contractors. 

If the current role of contractors on the battlefield is to become the status 

quo, government officials must clearly document the actual cost efficiency 

of the practice, in both the short term and long term. However, little solid 

evidence exists to document actual savings based on long-term experience. Much of the information currently available is conflicting. Cost 

overruns are common. Poor management and supervision often accompany the current practice of contractor support largely due to a shortage of 

Army supervisory personnel and training. Experience reveals that certain 

types of contracts, particularly cost-plus and open-ended contracts, often 

result in increased costs and sometimes fiscal abuse. Leaders must also 

identify and quantify hidden costs, such as increased security needs and 

the additional costs of supporting contractor employees in the field, and 

take action to curb abuses. Military organizations, rather than the General 
40 

Accounting Office (GAO), General Services Administration (GSA), or 

Office of Management and Budget (OMB), should be the key to documenting the linkages—whether cost savings or increases—between theory 

and practice. 

Government policies since the 1950s have consistently supported the 

implementation of privatization and outsourcing options, where applicable, as checks on governmental growth and rising costs. In addition, 

competitions can enhance customer service and performance. The goals 

of “competitive sourcing,” an important agenda item in President George 

W. Bush’s management strategy, are to “promote(s) innovation, efficiency, and greater effectiveness.”1

 Scholars at the Reason Public Policy 

Institute describe competitive sourcing as “part of a performance-based 

management initiative designed to improve performance and efficiency. 

Competition done right drives down costs and ratchets up performance, 

often dramatically.”2 Several studies support the cost efficiency of using 

civilian employees to fulfill certain functions in peacetime.3 However, 

Congress also recognized that certain governmental functions operate independently of commercial activity. The 1998 Federal Activities 

Inventory Reform (FAIR) Act required government agencies to inventory 

and classify positions as “commercial” (jobs open to competitive sourcing) or as inherently governmental (functions that government employees 

must administer and manage). A May 2003 revision of Circular A-76 

concurred with the concept of inherently governmental functions, and the 

regulations exempted activities identified as such from competition with 

private business entities.4 Current policy, however, often challenges these 

boundaries between public and private organizations resulting in an inconsistently applied policy. 

While critics of privatization challenge the wisdom of applying outsourcing or competitive sourcing policies to military functions, advocates 

dismiss these concerns as misunderstandings. Jacques Gansler, former 

Undersecretary of Defense for Acquisitions, Technology, and Logistics, 

labeled certain criticisms—in particular, unrealized projections of cost 

savings and poor performance or quality—as “competitive sourcing 

myths.” He concluded, “these theories increasingly are being tested, and 

the data are proving them wrong.”5 Gansler cited research that supported 

both short-term and long-term cost savings. A study of large municipalities reported cost reductions of up to 60 percent, with a 25-percent average 

improvement in service.6 The GAO concluded that Defense Department 

competitions could produce savings even when government employees 

continued to perform the function under study. GAO’s work noted that A-76 
41

studies reduced costs by 39 percent overall and concluded “the savings ... 

are substantial and sustained over time.”7 The Center for Naval Analysis 

reported an average cost savings of 31 percent from Defense Department 

competitions conducted between 1978 and 1994.8 The OMB attributed 

a 15-percent reduction to competitive sourcing efforts in 2003.9 Critics 

remained skeptical despite these positive predictions.

Other criticisms leveled at military privatization include reduced 

quality control, elimination of small businesses from government contracts, and creation of widespread unemployment. Research disputed 

many of these allegations. The Reason Public Policy Institute concluded 

that government agencies and Federal Acquisition Regulations, such as 

OMB Circular A-76, focus increasingly on “best value” or “the best combination of cost and quality” to avoid purchasing poor quality work or 

goods.10 Additionally, Defense Department officials maintained that small 

businesses were able to acquire a significant share (79 percent) of government business from 1995 to 2001.11 Layoffs of government employees 

were minimal (8 percent); most employees eliminated by the competition 

transferred, left voluntarily, or retired. Moreover, GAO and OMB studies concluded that competition often enhanced management controls, as 

government employees were able to establish firm performance standards 

and ensure the final product met contract specifications. GAO reasoned 

that because “an outside agency” monitored contractor activity, eliminating possible conflicts of interest from self-policing government agencies 

made additional savings possible.12

The lack of long-term, comprehensive studies makes it difficult to 

evaluate either position. The evidence available simply does not support 

the cost efficiency of the current system of contracting during wartime or 

operations other than war, especially for extended operations. Americans 

configured the current force structure for the peacetime conditions anticipated after 1991. The decision to reduce US military forces and to rely on 

contractor support for contingencies did not account for the security needs 

of the post-Cold War world. OIF and OEF were unimaginable. A great 

deal of experience from these recent conflicts has yet to be distilled into 

coherent lessons learned; however, studies from Bosnia illustrate potential 

problems. The GAO notes the “Army Should Do More to Control Contract 

Cost in the Balkans” and suggests the “Need to Strengthen Guidance 

and Oversight of Contingency Operations Costs.”13 Additional research 

observed significant challenges to the overall efficiency of the contracting 

process, including long-term readiness, cost increases, and in some cases, 

poor quality of work or nonperformance.14 Increasingly, government 
42 

policies impede competition, provide complex and conflicting regulations 

(military doctrine), problematic contractual arrangements, hidden costs, 

and fiscal abuse. Stated more succinctly, savings derived from theory and 

estimates do not always translate into actual savings.

Current doctrine requires careful attention to the statement of work 

(SOW) and other terms of each written contract. However, DOD’s 

Inspector General recently observed that out of 113 service contracts written in 2003, “at least 98% had one or more problems.”15 Historically, costplus-percentage-of-cost contracts create few incentives for fiscal responsibility as the company’s profit increases in direct proportion to operational 

costs. Makinson’s study maintained that fully one-third (of dollar amount 

awarded) were cost-plus instruments.16 Contingency contracts with open 

task order capacity also have the potential for cost overages and fiscal 

abuse. Several members of Congress recently expressed concern that the 

Coalition Provisional Authority in Iraq awarded 10 cost-plus indefinitedelivery/indefinite-quantity contracts worth $5.1 billion to a single contractor.17 The GAO noted that the Army frequently failed to consider costs 

when acquiring additional contracted services, and did not validate the 

necessity of recurring charges.18 Nevertheless, contingency contracts with 

open task order capacity are common.19

Three important elements determine the degree of successful outsourcing: competition, clear and consistent policy, and appropriate levels of 

management and supervision. Undersecretary Gansler identified competition and performance incentives as the critical elements, with two caveats: 

competition must “focus on best value, rather than simply low cost” and 

the competition process needs “improvement.”20 Although policy supports these elements in theory, complex social and political priorities and 

regulations impede competitive bidding. Manpower shortages and the lack 

of trained personnel prevent oversight. As a result, some investigations 

revealed that more than 60 percent of recent Pentagon contracts were not 

awarded on a competitive basis.21

No-bid contracts can eliminate cost savings, particularly if the contracting agency fails to conduct a cost benefit study. Competitive bidding 

is a lengthy and complex process, often limited to a few companies that 

retain the necessary capability and experience. In the aftermath of the 

September 11, 2001, tragedy, time constraints required immediate action. 

In addition, political factors can obscure other considerations. Under 

a program administered by the Small Business Administration (SBA), 

many minority-owned companies are eligible for preferential bidding procedures. Recently, DOD awarded several no-bid contracts to an Alaskan 
43

native-owned company who then partnered with multinational conglomerates Wackenhut and Vance International to provide security to the United 

States Military Academy at West Point, the US Army War College, and 

nine other military installations. Army spokesperson Jerome Kelly credited expediency and performance as the deciding factors, although legislation provided the opportunity to submit some bids without competition or 

a cost-benefit study. A reporter noted, “This circumvented a mechanism 

that was supposed to help ensure that privatizing would save money.”22

The security contracts awarded to Alutiiq-Wackenhut were reportedly 

worth up to $500 million—no trivial sum.23 Circumventing the competitive process eliminates the justification for privatization.

Indirect or hidden costs also detract from projected savings. FM 

100-10-2 explains, “As the use of contractors in contingency situations 

increases, the Army assumes increasing responsibility to feed, house, 

equip, and protect contractor employees operating on the battlefield, 

including predeployment training and TPFFD.” The obligation of support 

extends, in practice, to American allies and coalition partners; this broad 

reading of the field manual renders earlier estimates immaterial. FM 100-

10-2 recognizes this difference in theory and “practice, [where] US forces 

often provide unique support to other participating nations, or to contract 

in nations with business practices that differ markedly from those in the 

US.”24 The presence of a number of contractors performing multiple tasks at 

several locations may force commanders to change plans or use additional 

intelligence assets to locate and track the movements of contractors and 

their employees. AR 700-137 observes, “The need for the extension of 

security management to the contractor will result in an additional cost.”25

Management of contractors requires additional military specialists (or 

contractors) to provide oversight for the contracted projects. Makinson 

asserts, “The Pentagon has even hired contractors to advise it on hiring 

contractors.”26 These concerns justify conducting a more comprehensive 

analysis that identifies miscellaneous costs and updates estimates. 

Inadequate supervision of contractor projects can encourage a host of 

added costs—budget overruns, fiscal abuse, and poor performance that 

translates into an increased risk for soldiers. Congressional committees, 

Army regulations, and government review agencies acknowledge a chronic 

lack of accountability. FM 3-100.21 notes: “Contractor accountability 

has been, and continues to be, a significant challenge to command at all 

levels.”27 Members of Congress acknowledged their concern that the Iraqi 

Coalition Provisional Authority had awarded seven program management 

contracts to private companies—contractors managing contractors—and 
44 

prescribed clear recommendations. Referring to the practice as “potentially 

troublesome,” House Committee members deemed that contractors should 

not fulfill “inherently governmental functions” and should be used only 

when federal employees were unavailable. Moreover, contractors were 

appropriate choices only when the contractor had no conflict of interest 

or the appearance of a conflict with the contractors they manage.28 These 

three expectations are highly unrealistic, especially given current military 

staffing levels, particularly in administrative positions, and the large 

number of contractors operating in the field. The number of military 

acquisitions specialists has decreased by as much as half in recent years. 

Consortium arrangements and corporate affiliations and structure (large 

corporations who own smaller specialized subsidiaries) increase the 

likelihood of at least a strong appearance of conflict of interest within the 

PMC community. Thus, as contractors replace government employees 

and assume many military staff positions, even fewer regular military and 

DA or DOD civilian personnel become available. Subcontractors are an 

additional step removed from government supervision and accountability 

and bring additional interests and conflicts to the force mix. A recent 

example involved an alleged Russian illegal arms trafficker who earned 

millions of US taxpayer dollars as a subcontractor in Iraq, although the 

Treasury Department had frozen his assets and barred him from eligibility 

for US contracts.29 

The GAO has identified a number of other problems with Army 

contract procedures. They noted “confusion over the government’s 

authority under the contract,” inadequate training of military personnel, 

and frequent personnel rotations as chronic problems in military 

operations in the Balkans, concluding that the Army “could do more to 

control costs.”30 Moreover, the GAO pointed to more than $101 million 

of questionable expenditures in 2000 and 2001, which they attributed 

to limited guidance and oversight, “combined with a lack of costconsciousness.”31 Decentralized procurement led to duplications and 

waste. GAO’s studies alleged that poor accounting procedures made a 

determination of actual costs and compliance with regulations, such as the 

50-percent limitation on maintenance performed by contractors, difficult. 

They concluded that “Continuing weaknesses in DOD’s data gathering, 

reporting processes, and financial systems” made service reporting “rough 

approximations” rather than accurate documentation of compliance with 

the law.32 Some military commands requested waivers to release them 

from this legal requirement.33 When the US government declines to follow 

its own regulations, contractors have even less incentive to do so. 
45

Government watchdog organizations and mainstream journalists have 

been critical of the current system’s vulnerability to fiscal abuse, and note 

that given the current level of decentralization, the right hand may not 

know what the left hand is doing. One can open the daily newspaper or 

visit any investigative news Internet site to discover a number of charges of 

fraud, mismanagement, and waste. A well-worn charge attempts to make 

political connections between Halliburton’s rapid earnings growth—up 

to $4.3 billion in fiscal year 2003—and Vice President Richard Cheney. 

Halliburton’s acquisition of no-bid contracts and alleged over billing by 

as much as $1 million fuels accusations.34 The Center for Public Integrity 

maintains that the Defense Department awarded half of Halliburton’s 

contracts on a noncompetitive basis. Auditing by the GSA uncovered 

widespread agency violations within the Federal Technology Service 

(FTS), an agency that offered contracting services to DOD.35 At the time 

of the investigation, the Defense Department was the largest customer of 

FTS. In response, Pentagon officials announced new initiatives to correct 

the improprieties.36 

Several projections support the benefits of competitive sourcing—the 

cornerstone of the Bush Administration’s model of efficiency; however, 

the complexity of government policies, time constraints, and specialized 

interests continue to impair economic competition. While incentives, outsourcing, and privatization may be efficient management tools for private 

business, officials have yet to translate them into effective management 

tools for military operations. Peacetime contracting, rather than implementing a national draft, may pay more dividends and contracting during 

war may pay fewer dividends unless carefully managed and resourced. 

Contractor management in OIF and OEF is, at best, minimal, and public 

support may erode as charges of waste and fraud continue. An extremely 

broad definition of nongovernmental functions and the theory that private 

interests are always more efficient resource managers are limiting and 

sometimes false assumptions. In sum, privatization builds on assumptions 

that may not have universal application and actual practice may not mirror initial estimates, unless they continually incorporate significant feedback. More importantly, however, the most efficient use of our economic 

resources may risk military effectiveness. 

The integration of PMCs as a greater percentage of the force mix 

can directly impact military capabilities. Leaders must consider how the 

fundamental characteristics and philosophical differences of organizations guide their actions on the battlefield. National strategies determine 

military priorities, and clear guidelines for appropriate theater command, 
46 

authority, and responsibility are necessary to resolve command and control problems on the battlefield. Doctrine must be clarified, deconflicted, 

and consistent. Military leaders are responsible for documenting the linkages, negative or positive, between contracting and the maintenance of 

military capabilities. 

Military and corporate strategies illustrate that significant differences 

form the underpinnings of business and military cultures. Recently, Acting Secretary of the Army Les Brownlee and the Army’s Chief of Staff 

General Peter J. Schoomaker described Army culture as “one of selfless 

service, a warrior culture rather than a corporate one.”37 Brownlee and 

Schoomaker stressed the importance of structuring a “Campaign quality 

Army with Joint and Expeditionary Capabilities,” defined by its ability to 

“sustain those operations for as long as necessary.” Halliburton defines 

their vision as “Leading the world in integrated energy services, energy 

equipment, engineering, construction, and maintenance. Supported by 

four key goals: Technological Leadership ... Operational Excellence ... 

Innovative Business Relationships ... [and] Dynamic Workforce.”38 Even 

though the warrior culture is an ideal, and profitability and excellent service are not mutually exclusive, philosophical differences could make 

integrated action difficult. These conflicts warrant careful consideration 

when attempting to meld the two organizations into one effective force. 

Army policy and commercial activity also have the potential to develop 

conflicts of interest. Critics charge that when the US military employs private entities to write Army regulations and field manuals, the relationship 

constitutes a conflict of interest, particularly when the contractors earn 

business based on their specifications and procedures. The first company 

awarded the logistics civil augmentation program (LOGCAP) contract, 

Kellogg, Brown, and Root, also wrote AR 700-137. PMCs wrote both 

Army field manuals explaining the use of contractors on the battlefield. 

Indeed, the opening paragraphs of each document read somewhat like an 

advertising brochure. FM 3-100.21 notes, “to reach a minimum of required 

levels of support, deployed military forces will often have to be significantly augmented with contractor support” (emphasis added).39 Moreover, 

FM 100-10-2 observes, “To bridge the gap before scheduled resources and 

CSS units arrive, or when other logistical support options do not provide 

the supplies and services needed, the Army is turning more frequently to 

contracting support....”40 As commercial organizations, contractors strive 

for a reasonable level of profit, which generally depends on other corporate obligations, opportunities, and market factors. Military organizations 

have no expectation of profit and a single priority of national service. If the 
47

US military relies too heavily on contracted support, Congress may face 

the possibility that the business climate, rather than national interest, will 

determine the nature (and the costs) of foreign policy. 

Military effectiveness is a product of national defense politics, which 

produces the leadership, personnel, material, and strategic resources with 

which military institutions maintain combat effective forces for the nation’s 

defense. Combat effectiveness, in turn, includes several components that 

impact personnel generally at the operational and tactical levels. For 

enlisted personnel, these concerns center on training, discipline, and 

mental and physical conditioning. Officers require an educational system 

that promotes a broad understanding of the application of military power, 

in addition to tactical, logistical, leadership, and management expertise. 

Military leaders must perceive the nature of the threats, shape operational 

strategy, and accurately estimate the resources necessary to accomplish 

their goals. The resulting policies and regulations address coordination 

of joint and multinational forces, force rotation, group cohesion, training, 

performance, and all aspects of military competency.41

The highest level of this political process consists of national strategy, 

which defines the priorities and responsibilities of governmental agencies. 

The National Security Strategy, released by President George W. Bush 

in 2002, sets a standard of “American internationalism that reflects the 

union of our values and our national interests ... [including] political 

and economic freedom, peaceful relations with other states, and respect 

for human dignity.” A critical peg in accomplishing that strategy is to 

“reaffirm the essential role of American military strength ... to defend the 

United States.”42 National policy, then, sets high standards for military 

effectiveness. Without a clear focus on this critical element, other 

political, social, economic, and individual interests can complicate the 

decisions leaders make concerning the Nation’s military power. These 

factors are particularly relevant given the nature of defense spending as a 

discretionary budget item. 

In addition to the goals of the president, the National Military 

Strategy identifies the military priorities necessary to accomplish national 

strategy. In 2004, Chairman of the Joint Chiefs of Staff Richard B. Myers 

articulated a strategy of protection that includes prevention of attacks 

and the ability to prevail over enemies.43 In addition, Myers set three 

priorities, “win the War on Terrorism ... enhance our ability to fight as 

a joint force ... [and] transform the Armed Forces.” Other key phrases 

include the importance of persistence, readiness, adaptability, and the 

maintenance of “substantial military capability.” Moreover, Myers set 
48 

projected readiness goals as “a force sized to defend the homeland, deter 

forward in and from four regions, and conduct two, overlapping ‘swift 

defeat’ campaigns.” The strategy also requires an “‘active defense-indepth’ that merges joint force, interagency, international nongovernmental 

organizations, and multinational capabilities in a synergistic manner,” and 

sets high standards for rapid deployment.44 Although fiscal responsibility 

is an unwritten expectation, neither the National Security Strategy nor the 

National Military Strategy prioritizes budget concerns. In other words, the 

Nation expects a military that can accomplish missions rather than the best 

military they can afford. 

These priorities could be difficult to sustain given the current level 

of dependence on contractor support. FM 100-10-2 mentions some of the 

risks associated with use of contractors to mission completion: they “aren’t 

soldiers; they might refuse to deliver goods or services to potentially dangerous areas, or might refuse to enter a hostile area regardless of mission 

criticality,” thus, “contractor support is not always the proper means to 

support the mission.”45 Commanders must plan for the eventuality that 

regular forces may be necessary if contractors do not fulfill their duties. 

AR 700-137 reiterates this inherent risk: “their [contractor] performance 

cannot be accurately predicted.”46 The duplication of effort is a distraction 

from the mission. Moreover, contractors and their employees may interact 

unfavorably with local populations, governments, or commercial firms, 

thereby causing damage to US reputation and political objectives. It is 

difficult to plan for contingent military operations, as they often hinge on 

the enemy’s reactions; it may be impossible (or at least expensive) to plan 

for unexpected deployments and contingency operations when contractor 

support may be unreliable. Additionally, the tools the commander employs 

to guide his decisions—doctrine—may merely be a blunt instrument. 

The complex system of doctrine and regulations that govern military 

contracting includes ambiguous and conflicting guidance, unrealistic 

goals, and conflicts of interest. Current doctrine fails to address adequately 

the planning, training, and integration of contractors into the military force 

mix. Initial regulations made provisions for contracted services during 

emergencies and rapid deployments. The 1985 LOGCAP contract was to 

“preplan for the use of civilian contractors to perform selected services 

in wartime to augment Army forces.” The purpose of the contract was 

to “identify support and program force requirements that can be accomplished with an acceptable level of risk....”47 As the need for contracted 

services increased in proportion to the number of deployments throughout 

the 1990s, the ability to add additional tasks onto LOGCAP began to alter 
49

the role of contractors on the battlefield. In 1997, the Department of the 

Army released a policy memorandum to “provide a consistent and uniform policy on the use of U.S. contractors to augment the support of U.S. 

Army operations.” The policy defined the role of contractors as “effective 

Combat Service Support force multipliers” and identified the battlefield as 

a legitimate, although temporary, area of contractor support. Additionally, 

the memorandum established the contracting officer or his designated 

representative as the “liaison for monitoring contractor performance”; 

this determination removed the ability to exhibit command and control 

over contractors from the military chain of command. The memorandum’s 

writers concluded, “contractor employee protection during MOOTW 

will depend on the specific circumstances of an operation.” Although the 

policy had attempted to establish clear roles and responsibilities, many 

aspects of the relationship remained unclear.48

Thus, a dual chain of command and responsibility governs PMCs. 

While contractor employees remain outside the military chain of command, commanders retain responsibility for “the physical and spiritual 

quality of life for the contractor’s workforce.”49 The terms and conditions 

of the contract determine what the contractor will do, with the contracting 

officer or the contracting officer’s representative acting as liaison between 

the military chain of command and the contractor’s corporate authority. 

This creates a labyrinth of channels that field commanders must breach 

when conducting operations in areas with contractor support. Moreover, 

the visibility of contractor units is often poor, which can lead to a critical 

lack of communication and a high degree of risk to the surrounding (civilian and military) units.50 Field manuals, Army regulations, and other guidance suggest that military units should fully integrate contracted units into 

their force structure. At present, contractor involvement in the planning 

and training phases of deployment is minimal. Continuing feedback from 

OIF and OEF will determine the scope, practical effect, and added costs 

of this complex chain of command. FM 3-100.21 recognizes contractor accountability as a “significant challenge to command at all levels.” 

Security violations, theft, and deliberate sabotage are potential risks, when 

the field commander has a number of disparate units incorporated into his 

or her force structure. Initial doctrine dictated the prudent use of American 

contractors; however, from 1998 to 2003 at least 100 foreign owned corporations worked for the DOD.51 FM 3-100.21 admonishes officials to 

employ local contractors “from the antiterrorism perspective,” yet many 

critics of OIF and OEF excoriate the US military for failing to hire local 

workers. 
50 

The current bifurcated chain of command can obscure authority, either 

military or contractor. The Army policy of buying capabilities (equipment 

and the personnel to maintain performance and operation), rather than 

the traditional practice of buying equipment and providing the staff to 

carry out operations, creates overlapped responsibilities and duties where 

military personnel may perceive their role as subordinate to contractor 

authority. The GAO recently reported, “there is confusion over the government’s authority under the [Balkans Support] contract.”52 Contractors 

who provide dining hall services may set hours of operation or other rules 

that may conflict with military duties. When military units work alongside 

contractors, it has sometimes proven difficult to determine the relationship 

and responsibilities of each group. 

The confusing role of contractors prevents a clear-cut definition of 

military core competencies and the application of a consistent management strategy. Other important differences exist between these public 

and private organizations. Business managers strive for control of the 

entire production process that includes material, labor, transportation, 

and marketing costs, while the military commander is decidedly less able 

to manipulate the “fog of war.” Government services focus on national 

strategy goals, while private military companies stress profit. Thus, differences in the work environment, focus, and nature of the services provided 

separate the public and private spheres of military support. These differences may preclude “one size fits all” management. Currently, the role of 

contractors on the battlefield has few boundaries. 

Thus, while a number of important considerations contribute to military 

effectiveness and define military capabilities, the current system of providing manpower and material resources for military operations is problematic in several respects. Regulations and doctrine are complex, sometimes 

unrealistic and conflicting, and ambiguous. A host of complicated business 

and political interests heavily influence the process. Military effectiveness 

is only one of a number of goals that determine resource levels—it should 

be the primary determinant. Business, political, and military leaders must 

reevaluate the process to assure that it derives from a compelling national 

interest and that it is doable within the resources that Congress is willing to 

provide. In addition, legal ambiguities and inconsistent application of US 

regulations and law make American foreign policy goals and the projection of military power even more difficult. 

Leaders must clarify the individual and contractual legal status of 

PMCs. Are their employees combatants or noncombatants, civilians 

authorized to accompany the force or mercenaries, extralegal or responsible 
51

to political and fiscal authorities? Historically, all persons not involved 

in actual military operations or direct support of military operations were 

noncombatants—civilians authorized to accompany military forces in the 

field. Current regulations clearly indicate that military personnel will not 

ask contractors to perform duties that may jeopardize their legal status; 

however, there are few boundaries imposed on contractor activity or 

the location of their work. The Geneva Conventions (1918) and Hague 

Resolutions (1907) that generally determine the legal status of individuals 

may not apply during military operations other than war (MOOTW) and 

are invalid with combatants who are neither signatories nor recognized 

political entities. Status of Forces Agreements (SOFAs) define the legal 

status of American forces on foreign soil; however, the current Global War 

on Terrorism (GWOT) is not a conflict between recognized political entities. Increased integration of contractors in planning, training, and execution (living with and being supported by regular units) may lead enemies 

to conclude if civilians plan like soldiers, train like soldiers, and live and 

work like soldiers, they are soldiers. Even more tragically, enemies and 

allies alike may consider non-uniformed support personnel captured on 

the battlefield guilty of the crime of perfidy—“conducting hostilities in 

civilian attire.”53 In practice, the principle of distinction—the line between 

paramilitary operations and contractor support—has become so blurred 

that the US may be violating international laws of war.54 Certainly, the US 

loses the moral high ground by refusing to define contractor roles clearly 

and to recognize the same from their foes. 

There is also the risk that the contractors become extralegal, in effect, 

subject to few, if any, local authorities. Contractor employees are not 

subject to the UCMJ, and US law does not generally apply to Americans 

on foreign soil. Congress attempted to correct this defect in jurisdiction 

with the passage of the Military Extraterritorial Jurisdiction Act (MEJA) 

in 1999, which extends US law to deployed civilians. There are a number 

of difficulties attached to the enforcement of MEJA, not the least of which 

is the authority to gather evidence in foreign jurisdictions, and to date the 

law has produced no convictions. 

Two recent scandals are prominent examples of the implications of 

lax authority: the possible violation of Army policy and the difficulties 

posed in prosecuting contractor employees. In Abu Ghraib prison, contracted employees worked alongside regular military units performing 

similar roles in the interrogation of prisoners, despite an Army memorandum defining intelligence as an inherently governmental function.55

While investigators continue to examine the details of the scandal fully, 
52 

the US Department of Justice has yet to charge contractor employees with 

criminal activity, even though the DOD has obtained convictions of military personnel under the UCMJ.56 A previous scandal involved contractor 

employees who allegedly engaged in illegal purchases of weapons and 

sexual slavery in Bosnia and resulted in the dismissal of the two employees who reported the atrocities.57 Writer Colum Lynch concluded that the 

allegations and resulting Army investigation “raise questions about the 

accountability of contract workers who engage in criminal activities while 

conducting business for the government.” Lynch also quoted a statement 

issued by the company spokesperson: “There is no jurisdictional authority 

to prosecute American civilians for crimes committed on foreign soil.”58 

Critics allege the US Justice Department has adopted the view that 

they lack jurisdiction over contractual violations in Iraq, as the contracts 

are agreements between the Iraqi Coalition Provisional Authority and each 

commercial entity, many of which are established multinational corporations and owned by non-US citizens.59 Taken together, these concepts suggest that the US would like to believe it could wage war with a shifting and 

flexible doctrine that leaves key terms open to individual interpretation. 

Current Army regulations and field manuals provide poor definitions 

and guidance regarding the meanings of key points of responsibility. 

Commanders “assume the responsibility to protect contractor personnel,” 

although the level or degree of protection is unclear.60 Does the commander 

guarantee physical safety in combat areas, or does this mean he will not 

allow contractors to enter areas where combat is likely? While Army 

policy does not permit civilians to perform any activity that would risk 

their noncombatant status, the mere presence of civilians on the battlefield 

risks the possibility that they “may be subject to hostile action,” and that 

the protections of international law may not apply.61 The issue of risk (to 

mission completion, regular forces, and contractor employees) is equally 

vague. LOGCAP describes its purpose as to “identify support and program 

force requirements that can be accomplished with an acceptable level of 

risk.” AR 715-9 notes that contractor support services “are not suitable in 

all situations.” Stating these regulations in a negative (what is not suitable, 

rather than what is appropriate) is decidedly less than clear direction on a 

matter of crucial importance. 

Traditionally, contractors conducted their activities where combat 

was less likely; regular forces often replaced civilian employees when 

combat became imminent. LOGCAP contracts specify the operational 

boundaries for contractor personnel as “Normally ... not ... forward of the 

brigade support area.”62 However, recent regulations are more ambiguous: 
53

“Commercial contract personnel may be employed in Areas of Operations 

(AO) as required ... as far forward as needed, on a temporary basis, consistent with the terms of the contract and the tactical situation.”63 This 

policy is a critical change in the traditional role of contractors in military 

operations; in addition, it changes the very nature of the expectations of 

the military force mix.

 The relevant manuals attempt to bring clarity to the confusion. AR 

715-9 “Establishes Army policies and responsibilities for using contractors on the battlefield,” and focuses on the management of US citizens 

deployed to provide support to regular army troops.64 Moreover, FM 

100-10-2 “is designed to assist ... Army logisticians and their staffs in 

identifying requirements and planning to facilitate procurement of goods 

and services on the battlefield.”65 FM 3-100.21 further defines contractor 

roles, describes their relationship to Army commanders, and “present[s] 

their mission of augmenting operations and weapon systems support” as 

an “added resource” for the commander. The manuals presume the presence of contractors in military operations and provide a rationale—almost 

an advocacy—for their extensive and continued use, particularly in forward positions. Over the span of 18 years, then, the purpose of private 

military companies ranged from providing “selected services in wartime” 

(LOGCAP) to almost any activity to support military operations.66 The 

key phrase “in operations-other-than-wartime” (AR 715-9) replaced 

“during wartime and unforeseen military emergencies” (AR 700-137). 

In 2003, FM 3-100.21 noted that “Army Service Component Commands 

(ASCC) will undertake measures necessary to outsource” with the primary determinants being “voids in force structure” and “appropriateness 

of the function” performed under contract. 

In late 2000, Assistant Secretary of the Army Patrick T. Henry outlined 

acceptable exemptions to the policy guidelines presented in FM 3-100.21. 

Henry’s memorandum determined that intelligence gathering at the tactical level was an “inherently Governmental function barred from private 

sector performance.” Exemptions also applied, Henry maintained, at the 

operational and strategic levels on the basis of “risk to national security 

from relying on contractors to perform this function.” Henry justified his 

determination based on the loss of specific organic capabilities, reduced 

oversight, and the increased possibility of foreign interference.67 However, 

recent scandals brought to public attention the fact that several corporations currently provide such interrogation services, most notably at Abu 

Ghraib prison.68 Such conflicting and inconsistent legal guidance thwarts 

American military efforts. 
54 

The greater percentage of PMCs providing military services formerly 

performed by uniformed personnel or DOD civilian employees can have 

profound consequences for the larger interests of society. The resource 

process does not operate in a vacuum, nor is it far removed from American 

society. Socio-economic factors also figure prominently in the determination of an appropriate force mix. Often, military effectiveness depends 

heavily on the issues of civil-military relations, psychological exhaustion, 

training and educational benefits, and personnel management. 

PMCs can destabilize the traditional civil-military relationship. Singer 

identified several conditions where PMCs will have a negative impact: the 

pay differential for similar tasks favors contractors, private forces detract 

from the reputation of the local military, contractors remain segregated 

from regular units, employment of PMCs impairs advancement opportunities or has authority over military units, and where private forces threaten 

to replace uniformed military personnel.69 While current policy advocates 

a seamless integration of military and contracted personnel, training, pay 

differential, and other factors may upset the balance of military and civilian interests. 

Several of the factors identified by Singer as destabilizing influences 

exist in current deployments. Contractor employees can receive higher 

pay and more generous benefits for similar work. The yearly base pay for 

an Army specialist or corporal with more than four years of experience 

is $21,769, while civilian truck drivers can earn $80,000 to $100,000 

annually.70 Blackwater USA compensates private security contractors in 

the range of $450 to $800 per day.71 The first $80,000 of civilian pay is 

nontaxable if the employees meet certain “days in-country” requirements, 

while soldier bonuses (combat pay) are tax free. Civilians also retain the 

right to resign whenever they feel uncomfortable with their working conditions, a luxury not generally afforded to military personnel. One civilian 

driver recently claimed that only three employees remain from his original 

group of about 20.72 Pay differentials may eventually lead to lower levels 

of retention (as enlistments expire, former soldiers may opt to work for 

contractors) and the necessity of higher bonuses (enlistment and retention) and hazard pay. Reductions in the military force and the proliferation 

of PMCs translate into fewer promotion opportunities and the eventual 

elimination of many uniformed positions. Moreover, a recent DOD review 

of 32,155 positions identified 9,500 additional positions that were “candidates for military to civilian conversion.”73 Unequal economic advantages 

and sense of well-being—especially when regular military units provide 

security for contractor convoys, essentially taking more risk for less pay 
55

and less job security—can be extremely detrimental to soldier morale.

Moreover, a combat-heavy military may detract from the prestige of 

national military service, discourage some from a military service career, 

and impair public support for military operations. Policy makers and leaders must consider the possible consequences of the current trends in contractor support on the long-term health of the military services, although, 

at present, the facts to conduct such analyses are sketchy. Current bonuses 

include lump-sum payments of up to $15,000 for immediate deployment 

to the active combat areas of Iraq and Afghanistan.74 Rising bonuses 

indicate recruitment deficiencies in dangerous positions—possibly resulting in a downward spiral—with escalating bonuses necessary for what 

may become a less qualified applicant pool.75 Early in 2005, the military 

announced a more lucrative system of bonuses offered to many Special 

Forces troops to improve retention.76 The American public may well question the moral aspects of encouraging combat specific positions, which 

may result in a loss of support and confidence in military organizations. In 

addition, using American soldiers exclusively to provide combat “tooth” 

is a curious irony to historical precedent, where nations often hired foreign nationals for some of their most dangerous fighting. Officials must 

examine the long-term consequences—military readiness, morale, public 

attitudes, and other issues—before continuing on the present path of routine contractor support. 

One such consequence concerns the future American workforce. The 

military has long served as an acceptable avenue for noncollege bound high 

school graduates (for personal or financial reasons) to receive employment 

opportunities while earning benefits, such as college tuition or vocational 

training. The Army offers enlistees opportunities to “earn professional and 

trade certifications, which will give you specialized skills and help you in 

a civilian career” in addition to education and veterans benefits and other 

educational programs such as “Troops to Teachers.”77 Many individuals, 

even those serving short enlistments, consider military experience and 

educational opportunities extremely valuable to their personal growth and 

future. Sociologists, as well, have documented the benefits of this training by noting the increased earning potential of most veterans over their 

nonveteran contemporaries with similar levels of education and training. 

Moreover, providing young adults with opportunities to earn their education or training will benefit society by producing a skilled American workforce. Soldiers also serve as goodwill ambassadors and accrue enormous 

personal and international benefits from their contacts with other cultures 

and peoples. Some of the most poignant photographs from OIF and OEF 
56 

illustrate the value of these experiences more adequately than words. 

Military service during World War II had a similarly profound effect on 

postwar society. Other service programs, including Americorps and the 

Peace Corps, serve comparable objectives and allow a select group of 

civilians to earn educational benefits while working on national and international community service and development projects.78 US Secretary of 

State Dr. Condoleezza Rice recognized the increasing need for such civil 

affairs personnel in her confirmation hearings before the US Senate.79

This potentially valuable avenue of service to the nation should not be 

wantonly disregarded in the single-minded pursuit of cost efficiency or 

through a misunderstanding of the nature and the variety of roles that 

today’s soldiers fill. The current trend toward a smaller percentage of the 

total US population with military experience also serves to further isolate 

the military community from the larger society they serve. 

In restructuring military forces to be more combat oriented, care must 

be given to maintain the psychological and physical well being and the 

combat effectiveness of each individual. This is even more relevant to the 

US Army and Marines because they often bear the brunt of close combat. 

Military service requires strong physical and psychological resolves, and 

a certain number of psychological as well as physical casualties occur 

from deployment and combat stress even during nonmilitary operations. 

Research by G.W. Beebe and J.W. Appel established 88 days of combat 

as the average psychological “breaking point.”80 Other studies determined 

that 60 days of combat were sufficient to produce psychiatric casualties as 

high as 98 percent of all surviving soldiers.81 Psychologists came to understand that combat fatigue—or post-traumatic stress disorder, nostalgia, or 

shell shock—was a function of the intensity of combat, the duration, and 

the quality of social support, both in the unit and when soldiers returned to 

society. Some research indicates that under certain conditions the exposure 

to combat needed to become a psychological casualty could be cumulative 

rather than consecutive.82 All this adds up to a certain number of maximum 

days in combat or extremely stressful situations that military personnel 

can endure before becoming combat ineffective, at the very least, without 

costly and extensive treatment for symptoms.83 

As the services restructure to incorporate more “tooth,” this can have 

important implications for the military as a career. Reasonably, we can 

conclude that each individual has a variable, but finite, number of days, 

weeks, or months that he or she can endure combat, particularly close 

order combat, or extremely stressful situations before becoming combat 

ineffective. Grossman concluded, “in this century ... our physical and 
57

logistical capability to sustain combat has completely outstripped our 

psychological capacity to endure it.”84 Continual deployment has adverse 

effects on the family and extended support systems of the soldier, which 

may contribute to broken homes and resignations. This could create a 

vacuum in experienced and properly trained personnel as a military career 

becomes less desirable.85 An additional concern is the aging of the current 

pool of employees with military skills, so prominent in the current contractor workforce, when regular military units do not grow and maintain 

capabilities. 

The current use of contractor support, from historical and practical 

perspectives, includes elements from the worst-case scenarios. No-bid 

and cost plus contracts thwart the very competition and financial incentives the government hoped to benefit from by using PMCs. The lack of 

oversight and visibility of the contracting process encourages fiscal abuse 

and poor performance. Taken together, these factors make it difficult to 

establish the cost efficiency of the current system of military contracting. Moreover, evidence suggests military effectiveness is impaired by a 

growing dependency on contractor support, a lack of command authority 

over contractor personnel, and the unclear boundaries between private and 

public (military) organizations. The very real change in the civil-military 

relationship presented by the overuse of contractor support and the social 

consequences of war without public mobilization detracts from a consistent national foreign policy and national security. The roles of the public 

and private spheres in government have intertwined so completely that a 

complex, and often vague, body of regulations is inadequate to untangle 

them. 

Although the previous discussion is somewhat speculative, it raises 

important questions for further study. A few certainties, however, emerge 

from the discussion. Political and military leaders must clearly define the 

role of contractors—the nature of the work they are allowed to perform 

and the legal and geographical limitations of civilians on the battlefield—

and the core competencies of the military services. The legal status of 

contractor employees as noncombatants must be firm, and the US government must resolve the ambiguity of contractual and criminal jurisdiction 

when American taxpayers foot the bill. Strategy, not politics, must determine the resources provided to the military and adequate policies put into 

place to assure accountability of both the military service commands and 

contractors. Reforms and competition must truly guide competitive sourcing if the goal of cost-efficiency is to be reached; but there will also be an 

inherent cost to society if the US continues on its present course. Officials 
58 

must address the impact of the current system on civil-military relations, 

particularly those identified by Singer as negative influences. Leaders 

must carefully consider the psychological limits of endurance of frequent 

combat and repeated deployments, and weigh the costs of military experience and education against the potential benefits. Military effectiveness is 

really the bottom line, and the evidence indicates that this is where several 

factors intersect: ideologies of the cost-effectiveness of privatization, a factionalized political process, but perhaps most of all, a nation that believes 

it can go to war without full mobilization of its citizens and economy. In 

this respect, the ghosts of the past still haunt us; from Korea, Vietnam, 

DESERT STORM, and the end of the Cold War, Americans learned to rely 

heavily on foreign labor, conduct limited war as inexpensively as possible, 

and that PMCs could serve certain political objectives. 
59

Notes

1. George W. Bush, The President’s Management Agenda, <http://www. 

whitehouse.gov/omb/budget/fy2002/mgmt.pdf> (6 December 2004).

2. Geoffrey F. Segal and Adrian T. Moore, “Frequently Asked Questions 

about Federal Outsourcing, Competitive Sourcing, and Competition,” Policy Brief 

23 (Los Angeles: Reason Public Policy Institute), 2, <www.rppi.org> (6 December 

2004).

3. US General Accounting Office, “DOD Force Mix Issues,” GAO/

NSIAD-95-5, 1994, 4, reports $15,000 savings per person per year through the 

use of civilian employees rather than a military person of comparable pay grade in 

peacetime—none of these studies has analyzed the cost efficiency of prolonged, 

intense conflicts; other sources that report additional cost savings are numerous 

including US General Accounting Office, “DOD Force Mix Issues,” GAO/

NSIAD-97-15, 1996; Rand Research Brief, “Does Competitive Sourcing Pay 

Off?” <http://www.rand/org/publications/RB/RB7536> (16 December 2004); 

US General Accounting Office, “Report to Congressional Committees: DOD 

Competitive Sourcing,” GAO-01-20, 2000, 4. 

4. US Office of Management and Budget, Performance of Commercial 

Activities, OMB Circular A-76 (Revised), 2003, <http://www.whitehouse.gov/

omb/circulars/a076_rev2003.pdf> (14 January 2005).

5. Jacques S. Gansler, “Six Myths of Competitive Sourcing,” Government 

Executive, 1 July 2003, <http://www.govexec.com/features/0603/ots0358.htm> 

(18 January 2005).

6. Ibid.

7. US General Accounting Office, “DOD Competitive Sourcing: Savings 

Are Occurring, but Actions Are Needed to Improve Accuracy of Savings 

Estimates” (Washington, DC: GAO/NSIAD-00-107, 8 August 2000); and US 

General Accounting Office, “DOD Competitive Sourcing: Some Progress but 

Continuing Challenges Remain in Meeting Program Goals” (Washington, DC: 

GAO/NSIAD-00-106, 8 August 2000). 

8. Gansler, “Six Myths,” Government Executive.

9. Ibid., See also Segal and Moore, “Frequently Asked Questions.”

10. Segal and Moore, “Frequently Asked Questions.”

11. Ibid., Gansler, “Six Myths,” Government Executive.

12. Ibid. 

13. US General Accounting Office, GAO/NSIAD-00-225, September 2000; 

GAO-02-450, May 2002.

14. GAO-02-450, May 2002; GAO-03-695, June 2003; GAO-03-818, July 

2003; GAO-04-1031, September 2004; GAO-04-915, July 2004; among others.
60 

15. Dan Guttman, “The Shadow Pentagon: Private Contractors Play a Huge 

Role in Basic Government Work—Mostly Out of the Public View,” The Center 

for Public Integrity, <http://publicintegrity.org/pns/ aspx?aid=386> (27 December 

2004).

16. Makinson, “Outsourcing the Pentagon,” The Center for Public Integrity.

17. House Report 108-553-Department of Defense Appropriations Bill, 

2005, <http://thomas.loc.gov> (27 December 2004).

18. GAO/NSIAD-00-225, US General Accounting Office Report to the 

Chairman, Subcommittee on Readiness and Management Support, Committee on 

Armed Services, US Senate, “Contingency Operations: Army Should Do More to 

Control Contract Cost in the Balkans,” September 2000, 13-16, 16-19.

19. Makinson, “Outsourcing the Pentagon,” The Center for Public Integrity.

20. Gansler, “Six Myths,” Government Executive.

21. Makinson, “Outsourcing the Pentagon,” The Center for Public Integrity.

22. Jay Price and Joseph Neff, “US: Indian Tribes Outsource Defense 

Contracts after Winning Them with Preferential Rules,” The News and Observer, 

28 November 2004, <www.corpwatch.org> (27 December 2004).

23. Ibid.

24. FM 100-10-2, 3-19, 3-20.

25. AR 700-137, 3.

26. Makinson, “Outsourcing the Pentagon,” The Center for Public Integrity.

27. FM 3-100.21, 2-9.

28. House Report 108-553, <http://thomas.loc.gov> (21 January 2004). 

29. Stephen Braun, Judy Pasternak, and T. Christian Miller, “Blacklisted 

Russian Tied to Iraq Deals,” Los Angeles Times, 14 December 2004.

30. GAO/NSIAD-00-225, “Contingency Operations,” 21.

31. GAO-02-450, US General Accounting Office Report to the Chairman 

and Ranking Minority Member, Subcommittee on Defense, Committee on 

Appropriations, US Senate, “Defense Budget: Need to Strengthen Guidance and 

Oversight of Contingency Operations Costs,” May 2002, 3.

32. George Cahlink, “Report Faults Defense Efforts to Track Contractor 

Work,” GOVEXEC.com Daily Briefing, 19 September 2003, <http://www.govexec. 

com/dailyfed/0903/091903gl.htm> (29 October 2004).

33. George Cahlink, “Military Depots May Be Surpassing Limits on 

Outsourcing Work,” GOVEXEC.com Daily Briefing, 29 September 2004, <http:

//ebird.afis.osd.mil/ebfiles/s20040930324940.html> (28 November 2004). 

34. Jim Miklaszewski, “Pentagon Audit Reveals Halliburton Overcharges,” 

15 March 2005, <http://msnbc.msn.com> (3 May 2005). 
61

35. Shane Harris, “GSA Investigation Documents Widespread Contract 

Abuse,” GOVEXEC.com Daily Briefing, 17 December 2004, <http://www. 

govexec.com/dailyfed/1204/121704hl.htm> (22 December 2004); also Harris, 

“Defense Tightens Reins on Outside Contracts,” GOVEXEC.com Daily Briefing, 

27 June 2004, <http://ww.govexec.com/dailyfed/0604/061704hl.htm> (12 

November 2004).

36. Ibid., see also Amelia Gruber, “Defense Urged to Promote More on 

Competition on Task Orders,” Government Executive, 17 December 2004. 

37. Les Brownlee and Peter J. Schoomaker, “Serving a Nation at War: A 

Campaign Quality Army with Joint and Expeditionary Capabilities,” Parameters

(Summer 2004): 5-23, 13. 

38. Halliburton website, <http://www.halliburton.com/about/index.jsp> (25 

January 2005).

39. FM 3-100.21, preface.

40. FM 100-10-2, iv.

41. See Allan R. Millett and Williamson Murray, Military Effectiveness, 3 

vols., 1988; and Allan R. Millett and Peter Maslowski, For the Common Defense: 

The Military History of the United States of America, 1984, rev.ed., 1994.

42. George W. Bush, US National Security Strategy, 2002.

43. Richard B. Myers, National Military Strategy of the United States, 

2004. 

44. Ibid., iii, 18, 5.

45. FM 100-10-2, 3-8.

46. AR 700-137, 3.

47. AR 700-137, 2. 

48. Kenneth J. Oscar and Alma B. Moore, “Policy Memorandum—

Contractors on the Battlefield” (Washington, DC: Department of the Army, 12 

December 1997).

49. FM 100-10-2, 3-19.

50. See Christopher D. Croft, Contractors on the Battlefield: Has the 

Military Accepted Too Much Risk? (Fort Leavenworth, KS: United States Army 

Command and General Staff College, 2001); James G. Kolling, Blair A. Ross, 

and Terrance J. Spoon, “Potential Combat Risks from Outsourcing of Selected 

Sustainment Functions” (Carlisle Barracks, PA: Army War College, 1998); 

Gordon L. Campbell, “Contractors on the Battlefield: The Ethics of Paying 

Civilians to Enter Harm’s Way and Requiring Soldiers to Depend Upon Them,” 

a paper presented to the Joint Services Conference on Professional Ethics 2000, 

Springfield, VA, <http://www.usafa.af.mil/jscope/ JSCOPE00/Campbell00.html> 

(7 July 2004); and Ann Markusen, “The Case Against Privatizing National 
62 

Security,” paper presented to several conferences, revised and submitted to 

Governance, June 2001 (New York: Council on Foreign Relations, 2001), <http:

//www.hhh.umn.edu/img/assets/3728/privatizing.pdf> (26 January 2005). 

51. Makinson, “Outsourcing the Pentagon,” The Center for Public Integrity.

52. GAO/NSIAD-00-225, “Contingency Operations,” September 2000, 21. 

53. LTC Mark David Maxwell, “The Law of War and Civilians on the 

Battlefield: Are We Undermining Civilian Protections?” Military Review

(September-October 2004): 22.

54. Ibid.

55. Patrick T. Henry, Memorandum, Subject: Intelligence Exemption.

56. The San Diego Union-Tribune, editorial “Army Prosecutors are 

Convicting the Guilty,” 18 January 2005; numerous additional news articles. 

57. Colum Lynch, “Ex-U.N. Officer Sues U.S. Firm over Dismissal; Lawsuit 

Alleges Retaliation for Reporting Co-Workers’ Sexual Misconduct in Bosnia,” 

The Washington Post, 23 June 2001, A-20.

58. Ibid.

59. Debbie Elliott, National Public Radio, Morning Edition, 19 November 

2004, <www.npr.org> (26 January 2005). Elliott’s report includes remarks from 

attorney Alan Grayson. Although the US Attorney’s Office declines to comment 

on why they refused to join a whistleblower lawsuit, they explained to him 

(Grayson), “cheating the Coalition Provisional Authority ... is not the same as 

cheating the US government.”

60. FM 100-10-2, 3-8.

61. FM 100-10-2, appendix F.

62. AR 700-137, 4.

63. AR 715-9, 14.

64. AR 715-9, 3.

65. FM 100-10-2, v.

66. FM 3-100.21, preface.

67. Patrick T. Henry, Memorandum, Subject: Intelligence Exemption.

68. Quirk, “Private Military Contractors.”

69. Singer, Corporate Warriors, 198.

70. Army website, <http://www.goarmy.com/benefits/money.jsp> (20 January 

2005); see also James Glanz, “Truckers of Iraq’s Pony Express are Risking it all 

for a Paycheck,” New York Times, 27 September 2004, and T. Christian Miller, 

“The Conflict in Iraq; Road Warriors Deliver the Goods,” New York Times, 

29 August 2004.
63

71. Chris Bertelli, Personnel Representative of Blackwater USA, e-mail to 

author, 20 January 2005; Mr. Bertelli rightly points out that employees are only 

paid for the days they actually work, usually 60 days on and 30 days off with possible rehire, and that this amount includes no retirement or additional benefits.

72. Miller, New York Times, 29 August 2004.

73. GAO/NSIAD-97-15, “Converting Some Support Officer Positions to 

Civilian Status Could Save Money,” October 1996, 4.

74. Master Sergeant Lang, US Army Reenlistment Services, Fort 

Leavenworth, KS, phone interview with author, 19 January 2005.

75. Dave Moniz, “Recruits Swamp Navy, Air Force: Army and Marines 

Struggle with Goals,” USA Today, 24 January 2005, <http://www.usatoday.com/

printedition/news/20050124/1A_lede24.art.htm> (25 January 2005). 

76. Ann Scott Tyson, “Military Offers Special Perks in Bid to Retain 

Special Forces,” Christian Science Monitor, 21 January 2005, <http://www. 

csmonitor.com/2005/0121/p03s02-usmi.html> (3 May 2005). 

77. Army website, <http://www.goarmy.com> (20 January 2005).

78. See <http://americorps.org/whoweare.html> and <http://www.peacecorps. 

gov> (19 January 2005).

79. Condoleezza Rice, Senate Confirmation Hearings (18 January 2005).

80. Faris R. Kirkland, “Military Psychiatry,” in John Whiteclay Chambers 

II, ed., The Oxford Companion to American Military History (New York: Oxford 

University Press, 1999), 573-574.

81. Dave Grossman, On Killing: The Psychological Cost of Learning to Kill 

in War and Society (New York: Back Bay Books, 1995), 43-50.

82. Kirkland, “Military Psychiatry,” 573.

83. See also Eric T. Dean, Jr., Shook Over Hell: Post-Traumatic Stress, 

Vietnam, and the Civil War, 1997.

84. Grossman, On Killing, 45.

85. Advertisements for private security positions that require previous 

military or law enforcement experience illustrate this concept. See any number of 

private military corporate websites for examples. 
65

Chapter 5

Conclusions

Private military companies will continue to play an important role in 

US military operations. Contractor support on and off the battlefield is 

increasingly more visible and commonplace. Private resources assist the 

military in meeting global security voids created by recent political and 

economic restructuring and enable US forces to address foreign policy 

goals with a reduced force structure. Moreover, complex technology 

requires manufacturers to provide training and maintenance support for 

their products. To enhance the new emphasis on efficiency, military planners now utilize the tools of business management and adapt outsourcing 

and planned production and delivery to meet their needs on the battlefield. 

The demand for paramilitary services and the ample supply of PMCs willing and able to provide a variety of services on an international level is a 

mutually reinforcing trend that will continue for the foreseeable future. 

An increasing reliance on PMCs to conduct US military operations 

since the close of Operation DESERT STORM in 1991 has altered significantly, some would say irrevocably, the American way of war. Private 

contractors currently replace uniformed service members in many functional areas. Civilian contractors routinely perform staff work, develop 

educational curriculum materials, and write field manuals and other regulations. Umbrella contracts with add-on task order capability are common 

and increase the scope of contractor support. However, the current solution is definitely no magic bullet. Chronic problems include fiscal abuses 

and nonperformance or poor quality of service. Ineffective management 

and lack of contract supervision and oversight often lead to cost overruns. 

Officials frequently ignore lessons learned through painful experience, 

such as the problematic nature of open-ended cost-plus contracts and the 

negative consequences of relaxed regulations and institutional safeguards. 

Challenges to authority on the battlefield can lead to poor coordination and 

reduced mobility. In addition, a number of legal issues remain unresolved. 

In large measure, the armed services currently rely on the private sector to 

provide highly skilled labor, rather than growing and retaining their own 

capability, with unknown consequences to the future of the force and the 

nation. 

Constructing a force mix designed with military and civilian components is a conscious choice. The well being of military personnel and the 

society they serve, national security, foreign policy goals, and military 

effectiveness should be the overarching concerns. This process includes 
66 

identifying multiple economic, political, and social factors that impact 

military capabilities and American society. A rigid faith in privatization 

to unfailingly produce a positive influence—by reducing the size and cost 

of government—limits options and assumes that efficiency is the only 

factor involved concerning the appropriate force structure. Political and 

social concerns that impair competition, the very fundamental justification for privatization in the first place, emasculate privatization initiatives. 

Moreover, precedent and logic illustrates that some services, by their very 

nature, are better left to the public rather than to the private domain. At 

present, far too many decisions are budget driven when much more than 

economics is at stake. Military planners are mindful of conflicting goals; 

taxpayers expect responsible stewardship of resources and the maintenance of mission capability. Soldiers’ lives and national security depend 

on achieving the proper balance of efficiency and effectiveness. Historical 

evidence suggests that decision makers cannot presume the currently 

expanding role of contractors on the battlefield is a given for future military operations. If the military services are to retain their mission capabilities, congressional and military leaders must provide adequate resources 

and implement effective management. Much like lessons learned, the role 

of contractors on the battlefield is not a static and irrevocable decision, nor 

is there a constant formula that applies to all scenarios.

This study began with three essential questions that can serve as broad 

standards to evaluate the use of private contractors on the battlefield. First, 

do current policies concerning the use of PMCs represent maximum cost 

efficiency? While ample evidence suggests at least the potential of significant cost savings that project well into the future, the degree of theoretical 

savings that military organizations can achieve under practical, real-world 

conditions and restraints remains undocumented. In fact, the record reflects 

much evidence indicating that cost projections and mission requirements 

are frequently inaccurate and cost overruns are more common than ontarget or below budget predictions. Thus, no clear answer emerges. Much 

work remains to be done to establish the viability of actual monetary savings. More importantly, however, cost-efficiency is irrelevant if the end 

result detracts from military effectiveness.

The second relevant question requires a consideration of the complex relationship between the social, economic, and political aspects that 

contribute to military capabilities. Does the use of private contractors in 

the current environment contribute to military effectiveness? The present 

military force structure shows signs of fatigue and instability that indicate 

the overuse of contractors may detract from overall military effectiveness 
67

and capability. Certainly, PMCs contribute skills that can be costly to 

acquire and maintain in the military; in addition, significant cost savings 

can result from a smaller core of military personnel in times of relative 

peace, while retaining the capability to respond to contingencies. These 

concepts also conform to the political traditions of smaller government 

and the traditional distaste for a large “standing army” that are the cornerstones of American government. Theories of business management also 

point toward the useful aspects of structuring military forces with a mix 

of private and public assets. However, overreliance on theory rather than 

practice and private assets rather than public, particularly during prolonged 

periods of conflict, has no precedent. In sum, PMCs lack the exemplary 

performance record of American military forces in combat, coordinated 

action and protection is more difficult, costs rise unpredictably, and legal 

ambiguity often leads to great personal risks to both contractor employees 

and military units. Thus, a number of significant risks accrue to the extensive use of contractors on the battlefield. This increased risk detracts from 

overall military effectiveness. 

The third critical question that policy makers must consider is farreaching and more difficult to assess. Does the current extensive use of 

private military companies ultimately benefit American society and its 

citizens? Government managers must consider the potentially significant implications that derive from the increased use of contractors on the 

battlefield. Americans may do well to consider the social legacy of participation in World War II—the competency and independence women 

gained in the home and workplace, the educational levels attained through 

GI Bill benefits, and the affluence that resulted from full employment. It 

is reasonable to assume the current policy will have a similarly unique 

legacy. It is too early to identify many of these possible changes; however, 

a few are clear. The extensive use of private military companies can be 

disruptive to civil-military relations. More study is necessary to determine 

the long-term implications of change to the traditional dynamic. The loss 

of an avenue of national service for young people not bound for college 

may lead to a loss of prestige for military service. In turn, recruitment and 

retention may become more costly and difficult as the private sector offers 

more lucrative employment opportunities for military skills. The psychological cost of more frequent combat engagements is unknown and may 

be an untenable choice. 

Regardless of the merits of contractor support, there are, nonetheless, some clear mandates. The primary concern must be the well being 

of our most important resources—American soldiers, sailors, airmen, and 
68

marines. Private assets used in the force mix must contribute to military 

effectiveness—not augmenting, filling, replacing, or becoming the force 

structure. Retaining the competencies necessary to conduct National 

Security Strategy, rather than political expediency, cost efficiency, or any 

other factor or combination of factors, must influence the force structure and determine the resources provided to the US military. Similarly, 

because American society and its military are mutually reinforcing, leaders must be mindful of the social as well as the financial implications. 

Ultimately, military policy must benefit American society. Business and 

political theory cannot usurp appropriate management by responsible and 

responsive government employees. It has been observed that war is too 

important to be left to the generals; industry analyst Peter Singer adds that 

“war is far too important to be left to private industry.”* Americans cannot 

abdicate their responsibility to govern—and wage war—wisely.

*Singer, Corporate Warriors, 242.
69

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About the Author

Deborah C. Kidwell earned an M.A. (History) and an M.S. 

(Education) at Oklahoma State University (OSU), where she was the 

recipient of the Leroy Fisher History Paper Award and the O.A. Hilton 

Memorial Scholarship. She is currently completing a dissertation (History, 

University of Kansas) concerning Vietnam veterans’ memorials. While 

at OSU, Ms. Kidwell was a member of the Phi Alpha Theta Chapter 

and the representative for the History Department in the Graduate and 

Professional Student Association. She was an instructor at KU, where 

she earned a Graduate Teaching Fellowship Award, and at Northern 

Oklahoma Community College. Ms. Kidwell has authored instructional 

materials used in a vocational curriculum for the Mid-America Vocational 

Curriculum Consortium, Inc., and has presented a chapter from her 

dissertation at conferences and seminars. In the summer of 2004, Ms. 

Kidwell was a fellow at the West Point Summer Seminar in Military 

History. She maintains memberships in several professional organizations 

and her areas of interest include civil-military relations and 20th century 

US military, diplomatic, East Asian, Native American, and women’s 

history. Ms. Kidwell is currently an Assistant Professor of Military History 

at the US Army Command and General Staff College at Fort Leavenworth, 

Kansas.