Spies for Hire

by Tim Shorrock

  “As you well know,” he said, “the Intelligence Community is awash in huge amounts of unprocessed, raw data. Collection technology continues to outpace the ability to process, let alone catalogue, the growing volume. In concert (and often in conflict) with the information explosion is the trend toward downsizing throughout the federal government, including the IC. In this challenging environment, increasing attention is being focused on ways to augment the IC to help it accomplish its mission.” The conference, he said, would focus on the “interface” between the IC and the private sector. To that end, the organizers invited the new leadership of the IC to address the conference. The keynote was delivered by Joan Dempsey, then deputy director of central intelligence for community management. Another speaker, Keith Hall, the director of the National Reconnaissance Office, now works with Dempsey at Booz Allen Hamilton. And a third, John Gannon, the chairman of the National Intelligence Council, the Intelligence Community’s primary think tank, is now a senior executive of BAE Systems, which holds many contracts with the CIA and other elements of the community. The conference underscores how important outsourcing had become prior to Bush’s election and the events of 9/11.

  Nobody was more interested in these developments than Bill Golden, the former NSA officer we met earlier. A friendly, outgoing man who loves soccer, Golden spent twenty-two years with the U.S. Army. The highlight of his career was the ten years he spent at the NSA listening post at Misawa Air Base in northern Japan. In 1996, after he completed his assignment at Misawa, Golden brought his family back to Northern Virginia. This was a time when the agency’s mission was being revised and its workforce drastically reduced: during the 1990s, the NSA shut down twenty of its forty-two listening posts around the world, and the agency’s overseas workforce of military personnel was cut in half.79

  Upon his return to the United States, Golden was transferred to Fort Belvoir in Virginia, a U.S. Army intelligence center, for what he calls “an intelligence special mission.”80 But it was mostly a desk job, and boring at that, so Golden decided to retire from the Army. To keep the money flowing, he applied for a job at ARPA, and was placed with a small company doing research with ARPA funds on artificial intelligence. While working there, Golden learned how politicized the budget process can be in Washington. As disputes mounted in Washington between Republican congressional leaders and President Clinton over spending, Congress began doling out funds in ninety-day increments. This had a direct impact on Golden: just as his company was hired to build a new program for the Navy, he was fired.

  What could have been a crisis turned into opportunity when, a few months later, he began getting phone calls from former colleagues at the NSA and other parts of the Intelligence Community affected by the short-term budgets, asking him for leads on people like himself who had secret or top secret clearances and might be able to work on a temporary basis. So he began tracking intelligence jobs on a laptop and matching his contacts with potential employers. The NSA was one of his first clients, but mostly the calls came from contractors—Betac, Lockheed, Booz Allen, BAE Systems, CACI International, and other companies all needed people to fill the demand. The work was so good that, in 1997, Golden went into it full-time, and started a company: IntelligenceCareers.com. “I made so much money that I never went back,” he says. But so many former intelligence officers joined the private sector that, by the turn of the century, the institutional memory of the U.S. Intelligence Community now resided in the private sector. That’s pretty much where things stood on September 11, 2001.

  Even before the smoke had cleared from the World Trade Center and the Pentagon, the Bush administration had turned to U.S. intelligence for answers and information. Over the next few months, as the White House and then Congress began pumping money into the agencies and the new counterterrorism centers where intelligence and law enforcement were supposed to meet, the Intelligence Community had no alternative but to seek help from contractors. The 9/11 attacks sparked a huge increase in both the intelligence budget and in contracts: the IC’s spending on contracts soared to $32 billion in 2002 and peaked at $43.5 billion in 2005. It wasn’t until 2005 and 2006 that the government made a concerted effort to start hiring at the agencies themselves.

  But even if the Bush administration had chosen early on to allow agencies to hire people directly, it was too late: the people they needed immediately—that is, the hundreds of cleared and experienced intelligence professionals with the skills and background to start looking for the terrorists responsible for 9/11 and to prevent future attacks—were working in the private sector. And any new hires would take five to seven years to get up to speed. As a result, from 2001 on, the Washington area became a free-for-all for contractors. From the CIA to the Department of Homeland Security, longtime intelligence officers watched as thousands of contractors from companies like SAIC, Booz Allen Hamilton, and CACI came to work next to the analysts, doing essentially the same jobs, but for twice the pay.

  For many intelligence officers let go in the late 1990s, the contracting binge was sweet revenge. At least that’s the way Golden tells it. “During the late 1990s, they’d told all these people, ‘you’re a dinosaur, you’re a Cold Warrior without a purpose,’” he recalls. “Well, now they needed them, because they had the institutional knowledge.” And because contractors often had more experience than the people they were working for, they were put in situations where they had no supervision or oversight. Out of that came the situation at Abu Ghraib. The responsibility for that, argues Golden, sits squarely on the shoulders of the men in the Pentagon and the White House who brought them to Iraq in the first place. “If any company got in trouble, it was because of a lack of adult supervision,” continues Golden. “Because the government was suffering from a brain drain, it basically went in and told the contractors—‘hey, this is the person in uniform who’s here to baby-sit you, but you need to tell them what to do because they’re clueless. Now you’re the experts, and you make it happen. We have to go after Al Qaeda, and, oh, by the way, we don’t know how to do that anymore, but you do because you’re the contractor, and we pay you money, and you need to make this happen.’”

  One agency—the CIA—understood that logic more than any other. During the 1990s, it had experienced huge personnel cuts; but now, in the wake of the worst terrorist attack in U.S. history, it was being asked to explain what happened, find and go after the perpetrators, and staff the counterterrorism centers, all at the same time. To do that, the CIA turned to private sector contractors, which soon became the new face of U.S. intelligence.

  4

  The CIA and the Sacrifice of Professionalism

  WHEN MOST AMERICANS think about spies, the Central Intelligence Agency is the organization that first comes to mind. The CIA led the first strikes against Al Qaeda in Afghanistan after 9/11, and a CIA agent was the first American to die in what the Bush administration would call the global war on terror. The CIA was also the lead agency for the interrogation of Al Qaeda suspects captured on the battlefield and, as the American public learned in December 2007, used extremely harsh tactics to elicit information from them. Long before President George W. Bush announced U.S. intentions to overthrow the Saddam Hussein regime, CIA agents were in Iraq trying to organize resistance within the ruling elite. The agency remained center stage when the Bush administration sold the Iraq War to Congress and the American public. Its analysts were responsible for one of the most crucial documents of that period: the October 2002 National Intelligence Estimate, which concluded that Iraq possessed chemical and biological weapons and had the capacity to use them. The report was issued on the eve of a congressional vote authorizing the war, and George Tenet, the CIA’s director at the time, famously called its conclusions a “slam dunk.” His reputation, and that of the CIA, remain tarnished, even by the standards of the agency’s own Office of Inspector General, which called in 2007 for an investigation into Tenet’s failure to disrupt the Al Qaeda network prior to 9/11 and what the IG call
ed a “systemic breakdown” within the CIA’s Counterterrorism Center.1

  But even as the Iraq debacle played out before the public, the CIA found itself at odds with both the Bush administration and the neoconservative right over matters of policy. In the months preceding the March 2003 attack on Iraq, CIA employees were incensed when the Pentagon, with the support of the office of Vice President Dick Cheney, who was unhappy with the information he was getting from the CIA, established its own intelligence network to compete with the agency’s, and leaned heavily on the CIA to tailor its findings to administration demands. At the same time, Bush supporters were angered by the CIA’s repudiation of evidence purporting to link Saddam with Al Qaeda and by the hostility of some CIA officials to the upcoming war in Iraq and to other parts of the president’s foreign policy agenda. Later, the CIA workforce was shattered when administration officials leaked the identity of an undercover CIA agent, Valerie Plame, to discredit her husband, former ambassador Joseph Wilson, a prominent critic of the Iraq War.

  By 2007, the rift between the CIA and the neoconservative right seemed irreparable. That February, Michael Rubin, a fellow at the American Enterprise Institute and a former Pentagon adviser in Iraq, openly called for the privatization of the CIA. “The poor quality of the CIA’s analytical products is an open secret among intelligence consumers [and] seldom more analytical or detailed than published newspaper accounts,” he wrote in The Weekly Standard, the neocons’ most influential voice in Washington. Rather than expand the CIA, “the government should privatize much of its analysis.” Already, Rubin noted, “Beltway firms like SAIC and Booz Allen Hamilton operate streamlined intelligence shops. Their analysts hold the highest security clearances. So do many think-tank scholars and some university academics. Many private-sector analysts have language abilities and experience their government counterparts lack.”2

  Ironically, long before Rubin wrote his column, the CIA had already turned over more of its analytical work to the private sector than any other agency in the Intelligence Community. The CIA, according to more than a dozen former CIA officers, currently spends between 50 and 60 percent of its annual $5 billion budget on contractors. Greenbadgers, as these contractors are known, now outnumber the agency’s full-time workforce of 17, 500. They are doing almost everything career agents are doing. Contractors collect human intelligence, HUMINT, out in the field. They analyze raw, classified intelligence traffic coming in from stations overseas, and write reports that form the basis of finished intelligence estimates that are sent up the chain of command. They work in information technology, writing specialized computer applications, and creating charts that are used in classified briefings. One company even prepares false identities for CIA officers working undercover overseas. According to a groundbreaking 2006 report in the Los Angeles Times, at CIA headquarters in Langley, Virginia, “senior officials say it is routine for career officers to look around the table during meetings on secret operations and be surrounded by so-called greenbadgers—nonagency employees who carry special colored IDs.”3

  On the operational side, CIA contractors have fought alongside CIA officers and Special Forces in Afghanistan and, according to outsourcing expert R. J. Hillhouse, make up more than half of the workforce of the CIA’s National Clandestine Service, which runs the covert operations that differentiate the CIA from the rest of the Intelligence Community—the recruitment of spies in foreign governments and hostile organizations, and the launching of offensive military operations in places like Afghanistan. “The role of CIA employees has been largely reduced to contract managers and support administrators, supervising and supporting corporate program managers, who in turn oversee staff from other firms,” Hillhouse reported in 2007. “Virtually entire branches of the NCS have been privatized.”4 CIA front companies were also used in the secret “extraordinary renditions” program that sent many terrorist suspects to CIA-operated interrogation cells outside the United States. According to New Yorker reporter Jane Mayer, Jeppesen International Trip Planning, a wholly owned subsidiary of Boeing, handled “many of the logistical and navigational details for these trips, including flight plans, clearance to fly over other countries, hotel reservations, and ground-crew arrangements.”5*

  Overseas, contractors have been assigned to jobs as sensitive as deputy station chief, and have been used to open many of the stations closed because of budget cuts during the 1990s. Amazingly, in the intelligence hotbed that is Pakistan, a full three-quarters of the officers posted at the CIA station in Islamabad since 9/11 have been contractors.6 In Baghdad, where the CIA operates its largest overseas station, contractors have sometimes outnumbered paid government employees. Robert Baer, a former CIA field officer stationed in the Middle East, claimed in a 2007 article in Time that a private company working for the agency in Iraq was even deciding where CIA officers could go and who they could meet, “essentially determining who the CIA’s sources are.”7 I later learned that the company in question was Blackwater Worldwide, the private military contractor, which has a contract to provide security and analytical services to the CIA station in Baghdad.

  “This is a completely different culture from the way the CIA used to be run,” Baer, who spent a total of twenty-four years in the CIA, told me. “Everyone I know in the CIA is leaving and going into contracting whether they’re retired or not.”8 Many of the green-badgers, he said, are former CIA employees, often returning to the same jobs they had before they retired, and earning double or triple the salaries they made as government employees. The companies doing the hiring are scattered throughout the Northern Virginia suburbs of Washington, running from the business parks near Dulles Airport to the huge office and shopping complex at Tysons Corner. (“The Dulles Corridor,” Baer wrote in Blow the House Down, a novel based on his experience with the CIA, “was thick with Agency retirees working for Beltway Bandits with CIA contracts: SAIC, Booz Allen, Dyncorp, Titan, McDonnell Douglas. Everyone I knew seemed to be doing it once they hit the magic fifty: Retire on a Friday, back in the building Monday morning with a shiny new green badge.”9) A typical salary for a contracted analyst is $200, 000 a year, but that is only half of the $400, 000 charged by the companies for each slot, Baer and other former officers said.

  “We’re talking about a huge industry in terms of independent contractors, who are represented in all the offices of the CIA and throughout the building in Langley,” said Melvin A. Goodman, a thirty-five-year veteran of the agency who is now a senior fellow in the national security program of the Center for International Policy, a liberal think tank in Washington. Goodman contrasts the outsourcing of analysis today to earlier times, when the CIA’s Directorate of Science and Technology hired corporations like Lockheed and TRW to make the satellites and spy planes that produced overhead photography that CIA analysts used to determine if the Soviets were meeting their arms control obligations. “You could make the case that you had to go to Lockheed or the Skunk Works” where U-2 and SR-71 spy planes were manufactured, he told me. “But I’m not sure you can make that case now in terms of analysis and the training of analysts. There’s incredible waste going on. There isn’t a single office within the CIA that I’m aware of that hasn’t hired contractors.”10

  The CIA, which has been extremely hesitant in discussing its dependence on contractors, disagreed. “I can say with certainty that those figures are way off the mark,” a CIA press officer who did not want his name used told me. However, the actual number, along with the identity of any company that supplies contractor employees, is classified, he said. The agency’s overall assessment is that “contractors perform a vital mission to the CIA, and other intelligence agencies for that matter. They’re usually hired for specific skill sets for a short period of time to provide the agency flexibility in performing our mission.” The spokesperson did confirm that many of the green-badgers working at the CIA are former employees. “Many of our contractors have long experience with this agency in particular,” he said. “There are indivi
duals who are hired who spent their entire careers with the CIA. Contractors provide mission-critical work, they’re hired for specific reasons, and they’re highly experienced in the missions they’re asked to perform.” Asked about the high salaries paid to contractors, the CIA man said: “Government salaries are very competitive. Clearly, there is a marketplace in the contracting space. I can’t say what the figures are, but salaries do vary.”

  In May 2007, a few weeks after this interview, CIA director Michael V. Hayden, an Air Force general, announced the completion of a review of the agency’s use of private contractors he’d ordered in the fall of 2006. By that time, Hayden had grown concerned about the early resignations of employees who receive CIA training and then leave their jobs, only to return at higher rates of pay as green-badgers; in an interview with the Associated Press, he’d remarked that the CIA was beginning to look like “the farm system for contractors.” While these companies played “a vital role” in the CIA’s mission, he concluded, the agency had “not efficiently managed our contractor workforce, which grew out of staff hiring freezes in the 1990s and our greatly expanded ops tempo after 9/11.” Without giving any details, he said the agency had identified jobs that “must or should be filled primarily by staff officers” and those that can be done by contractors. In a first for an intelligence agency, he ordered the CIA to reduce the number of contractors by 10 percent by the end of 2008, and barred contracting firms from bidding for CIA employees within eighteen months of their departure from the agency, if they leave before retirement age. He also encouraged contractors to become staff employees in jobs requiring a higher proportion of government staff. “We will expedite the process for moving from a green to a blue badge worn by CIA employees,” he said.11