Blackwater's Bright Future

From California to Iraq, business has never been better for the controversial private security firm Blackwater Worldwide. Company President Gary Jackson recently boasted that Blackwater has "had two successive quarters of unprecedented growth." Owner Erik Prince recently spun his company as the "FedEx" of the U.S. national security apparatus, describing Blackwater as a "robust temp agency."

Such rhetoric may seem brazen, given Blackwater's deadly record in Iraq and troubled reputation at home, but here is the cold, hard fact: Blackwater knows its future is bright no matter who next takes up residence at 1600 Pennsylvania Avenue.

The company's most infamous moment came last September, when Blackwater operatives were alleged to have gunned down 17 Iraqi civilians in Baghdad's Nisour Square. A U.S. military investigation labeled the shootings a "criminal event," and a federal grand jury in Washington is hearing evidence in the case.

The father of one of the dead, a 9-year-old boy shot in the head, testified before the grand jury in late May. He has rejected offers of monetary compensation from the U.S. government and Blackwater; he demands a public admission of guilt by the company. "This is important for me, morally, for my family and my tribe," said Mohammed Hafidh Abdul-Razzaq. Other survivors have been offering testimony to the United Nations, and some have filed a lawsuit in federal court in this country.

At the end of the day, perhaps criminal charges will be brought against a handful of Blackwater operatives as a token gesture. But this will not bring substantive change to the unaccountable private war industry. Indeed, the killing of Iraqi civilians and other scandals do not seem to hurt Blackwater's business at all. Quite the opposite.

In April, over the objections of the U.S.-installed Iraqi government, which has demanded Blackwater's expulsion, the Bush administration quietly renewed the company's lucrative Iraq contract for yet another year. To date, the company has pulled in over $1 billion from its Iraq and Afghanistan "security" contracts alone.

Blackwater is also winning at home. The company recently fought back widespread local opposition to its plans for a new warfare training center in San Diego. When residents and local officials tried to block it, Blackwater sued the city. A federal judge, appointed by President Bush's father, ordered San Diego to stand down. Now the company is entrenched, guns a blazin', in San Diego and is well positioned to cash in on the increasingly privatized border-patrol industry.

Blackwater's California expansion is just one of several ventures that reveal how Blackwater is growing. Among the others:

* Prince's private spy agency, Total Intelligence Solutions, is now open for business. Run by three veteran CIA operatives, the company offers "CIA-type services" to governments and Fortune 1000 companies.

* Blackwater was asked by the Pentagon to bid for a share of a whopping $15-billion contract to "fight terrorists with drug-trade ties" in countries such as Colombia, Bolivia, Afghanistan and Uzbekistan. Analysts say it could be the company's "biggest job" ever.

* Blackwater is wrapping up work on its own armored vehicle, the Grizzly, as well as its Polar Airship 400, a surveillance blimp Blackwater wants to market for use in monitoring the U.S.-Mexico border.

But is Blackwater counting its chickens before they hatch? Some may see it as a foregone conclusion that if Barack Obama wins in November, Blackwater's days on the federal payroll would be numbered. Obama has labeled it "unaccountable" and a danger to U.S. troops in Iraq. (By comparison, John McCain's top strategist, Charlie Black, has worked for Blackwater.)

But it is far more complicated than that. Obama may want to draw down U.S. troops in Iraq, for instance, but "diplomatic security" is where Blackwater's bread is lathered with golden butter. Obama has pledged to increase diplomatic activity in Iraq and to keep in place the Green Zone and the monstrous U.S. Embassy in Baghdad. Despite his criticism, Obama may have no choice but to use these private forces. His top advisors have painfully acknowledged Obama "cannot rule [it] out."

Consider the numbers: At present, Blackwater has about two-thirds as many operatives in Baghdad as the U.S. State Department has diplomatic security agents in the entire world, including Iraq. Although Obama has said he wants diplomatic security to be done by U.S. government employees, accountable under U.S. law, the State Department estimates that it could take years to recruit, vet and train a force to take over Blackwater's work.

In addition, Obama's rhetoric on Latin America strikes familiar "drug war" chords, which bodes well for Blackwater, and he plans to send 7,000 more troops to Afghanistan, where the company is already firmly entrenched.

Blackwater's work in Iraq began with one $27-million no-bid contract to guard the U.S. administrator for the country, L. Paul Bremer III, in 2003. In five years it has metastasized into a central component of the U.S. presence in Iraq and is spreading fast into the most sensitive areas of the national security apparatus.

There is no question that a McCain White House would be preferred by Blackwater and its allies. The question is: Would a Democratic victory really be bad for business?

Jeremy Scahill is the author of "Blackwater: The Rise of the World's Most Powerful Mercenary Army."

Copyright 2008 Los Angeles Times