The War Service Industry's Future Financial Health: "Easily" Ten More Years in Iraq

In response to Senator John McCain's flip comments of spending thousands of years in Iraq, President Bush gave the war service industry a big boost to their financial bottom line. He said that the US could "easily" spend ten more years in Iraq.

This is music to the war service industry's ears. And to add icing to the cake, DOD Secretary Gates is considering sending 3000 more troops into Afghanistan to blunt any spring offensive by the Taliban. Since the US Army has contracted out more vital logistics than any other war in history, the war service industry will continue to rake in the government's money as long as we stay in Iraq and Afghanistan.

There have been jabs at reform but most are on hold. The Democratic Senate Freshman have succeeded in passing some impressive reforms and a commission to look at the war service industry but these measures were in the 2008 defense authorization bill that Bush has vetoed (because of another provision) and it is unknown if these reforms will survive the next round. In fact, Blackwater and other war service industry companies have ramped up their lobbying effort in DC and this does not bode well for reform.

The Army attempted, under pressure from the Congress and the media, to change the mother of all logistics contracts, the LOGCAP III contract with KBR, which is billing at least a half a billion a month to the government. The Army broke the contract out to three contractors, KBR being one, and had a contractor to oversee the other contractors. Although this LOGCAP IV contract was only marginally better for the US government, contractors who lost won an appeal to put the contract on hold. So the extremely expensive and wasteful LOGCAP III contract continues to be in effect with KBR billing at a breathtaking rate. In fact, the Center for Public Integrity recently released a report that found that "U.S. government contracts for work in Iraq and Afghanistan have grown more than 50 percent annually, from $11 billion in 2004 to almost $17 billion in 2005 and more than $25 billion in 2006."

This growth occurred before and after the recent troop surge so the number of troops in Iraq and Afghanistan doesn't seem to matter. Time is on the contractors' side, the longer we are there, the more they can bill, regardless whether the work has actually increased.

With the likes of Senator Ted Stevens admitting that the wars in Iraq and Afghanistan (apparently the new contractor growth area) are costing $15 billion a month, we may have found that the war service industry may be the best recession proof industry now in America. The longer they go unchecked and are allowed to infiltrate the Congress with lobbyists and lure experienced men out of our military, the harder they will be for the Congress to control. The cynics will invest in these companies to make money. Let's just hope that the reformers will get their reforms through and not fade in the face of the war service industry's increasingly powerful Washington presence. Every month in Iraq is putting a brutal crunch on our nation's money resources and the war service industry grows more powerful.

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Comments

[SirReal1]

The War Industry (aka Privatization) is one of the Cornerstones of Republican Policy Making (RPM), along with BigEnergy, BigPharma, and BigReligion. Pick any one of the four and you find a keystone, recession proof, investment worthy, industry, that has its foot in the door no matter WHO is in office. Add in the two siblings (BigAgro and BigMedia) and you have what has essentially become the six cornered platform of the Republican Party (is it just me or does the notion of the number 6 being significant make anyone else shudder).

These "Industries" have been carefully cultivated and have been preparing to take hold of the National Agenda for 50 years (Ike was right), and are now poised to keep us in their grip in perpetuity. Very soon, there will be NOTHING we can do to "throw them off our backs", as they will continue to seize control of "all things dear" to the American Consumer, until they have wrung our last dime out of our hands.

Currently the plan has the "production" for all our needs moved to major population centers in other parts of the world, gradually improving their standard of living (e.g. INCOME), in order to fill our hunger for the consumerism they created in us. Once we've signed away all that we once had, or will ever have, America will become the "Production Engine" again, at a lower pay rate than India currently provides, and the game will start over again until every nation "owes" more than they can ever pay, and the "top 1%" can sit back and just collect the interest.

[Hoosier84]

Hmmm. I think someone is missing the point.

The military operation in Iraq continues to be the best supported, best supplied military operation in history. I've mentioned this before, of course, but maybe it is worth repeating. The private sector support, including LOGCAP, could not be done by the military at ANY price - they don't have the capability and expertise and frankly prefer to focus their efforts on carrying out their mission.

KBR's astonishingly low 1% profit margin - and potential 2% bonus - is an amazing deal for taxpayers. Lots of things can be done to improve the process, but the basic concept has been hugely successful, and is now being copied by the Canadians and UK.

Full disclosure: KBR is NOT a member of IPOA (but should be!).

-doug brooks
IPOA

[Spookcatcher]

McCain is a Fascist and he knows his opportunity in the vacuum was to grab the MSM stage to couch his platform which is just a strategic begging act. Look, this ithe same thing as a Televangelist promising prosperity "if you believe in Jesus then send in you donations to me and I'll make sure jesus answers your prsyers. Comeon, let's everybody pay attention to the game. This may be the last chance for Our Republic to survive, much less elect some candidates that have the convictions to confront and overthrow the Elitist and the Fascist Supremists.

[Dap]

Dear Ms. Razor,

Once again thanks for the report and all your efforts. Agape.

[mbaty]

Exactly, and while we need a strong economy, the defense contractors shouldn't be how we do that, as that will obviously lead to false wars built on pretenses that mask the true goal--the economy. The ends really don't justify the means, and I think enough people are ready for an economy that is sustainable and stable for all peoples, not based upon privatized killing but on endevours that lift all people up to a better state of living.