by Tim Shorrock
Price wasn’t happy. The Forbes amendment “raises serious questions about the activities its proponents may be seeking to protect,” he said during the House debate. “Given that my bill only targets activities that are unlawful, why do my colleagues feel the need to clarify that it does not affect activities that are permissible? What activities are contractors carrying out that are permissible but not lawful? If there are private, for-profit contractors tasked with duties that require them to commit felony offenses, Congress needs to know about it. Such a revelation would point to a need for a serious debate about whether we are using contractors appropriately.”22
R. J. Hillhouse, blogging at her site The Spy Who Billed Me, described the types of illegal activities that contractors in Iraq and Afghanistan might be involved in: “Paramilitary operations—covert actions that involve contract soldiers in offensive combat—are the first things that come to mind,” she wrote. “Then, of course, there would be issues of illegal detainment of civilians as well as the problems with the use of ‘special interrogation methods’ by individuals directly contracted to the Agency (as in non-industrial green badgers).” The White House provision, Hillhouse continued, raised a critical question: “Has intelligence outsourcing gone too far when we start to outsource activities that would be criminal under US law? Did anyone in Congress ask what the hell corporations are doing on the US Government’s behalf if intelligence contractors need to be exempt from US criminal laws in war zones?”*
Steven Aftergood offered a more disturbing explanation. “The awkward fact is that intelligence collection operations are routinely conducted in violation of established laws, including international legal norms to which the United States Government is formally committed,” he wrote in Secrecy News.23 Aftergood quoted from a 1996 House Intelligence Committee staff report that contained revelations about the CIA that are still amazing to read twelve years later. The CIA’s clandestine service, the committee wrote, “is the only part of the IC, indeed of the government, where hundreds of employees on a daily basis are directed to break extremely serious laws in countries around the world in the face of frequently sophisticated efforts by foreign governments to catch them.” According to that report, CIA operatives working for the Directorate of Operations engaged in “highly illegal” activities “several hundred times every day (easily 100, 000 times a year).” Those activities, the House committee said, “not only risk political embarrassment to the U.S. but also endanger the freedom if not lives of the participating foreign nationals and, more than occasionally, of the clandestine officer himself.”
Given the huge increase in contracting since those words were written and the widespread use of outsourcing in the CIA’s clandestine service, it’s a near-certainty that contractors today are also breaking foreign laws hundreds of times a day. If that’s true, Congress has a right to know what outsourced jobs involve illegal acts and a duty to limit contracting to tasks that are both legal and subject to congressional oversight. Classified contracts should not provide cover for corporations to break the law.
Secrecy has come at a high political cost. As we’ve seen throughout this book, the lack of transparency and the classified nature of most intelligence contracts makes Congress’s oversight job over contractors almost impossible. Only a select few on the House and Senate committees with oversight jurisdiction over intelligence spending have access to specific projects, and that doesn’t even apply to the most classified ones. It took nearly two years, for example, for the Bush administration to hand over to Congress the legal documents justifying the NSA’s reliance on the telecommunications industry. Yet, as we’ve also seen, the companies themselves—at least their employees who hold top secret security clearances—have full knowledge of the details of secret contracts, from the bidding stage to the award. That leaves only a handful of people with knowledge of these programs, which allows only for internal debates between people holding such clearances. The public, and most of Congress, is completely left out, and have no real way of knowing how their money is being spent, let alone if it is being spent wisely. As Aftergood remarked in the opening chapter to this book, it’s not like a debate when one side loses: “there is no debate.” As a result, there is corruption in both contracting and the political process. We see it in “earmarking,” a process that allows lawmakers to secretly add to legislation spending provisions that benefit a company or project in their district.*
As mentioned earlier, the most notorious case of earmark corruption involved the former Republican congressman Duke Cunningham, who was convicted in 2006 of accepting $2.4 million in bribes from executives with MZM Inc., a San Diego intelligence contractor. In return for the bribes, Cunningham used his position on the House appropriations and intelligence committees to earmark tens of millions of dollars’ worth of contracts for MZM at the Pentagon’s Counterintelligence Field Activity office and the CIA. Marcus Stern, a reporter with the San Diego Union-Tribune who broke the MZM story, described the relationship between Cunningham and MZM CEO Mitchell Wade in an interview with Ken Silverstein, the Washington editor of Harper’s. One day, Cunningham and Wade held a luncheon meeting at the Daily Grill, a fancy restaurant in the Georgetown section of Washington. According to Stern:*
As they were talking about the future, Cunningham pulled out a piece of his own congressional stationery. He made a line of numbers down the left hand side of the stationery in which he wrote out the millions of dollars in contracts that he could provide to Wade, up to $25 million. He put corresponding numbers down the right hand side, in the tens of thousands of dollars, which was what he expected to get in the form of kickbacks or bribes—or what he would call gifts—from Wade. In exchange for the first $16 million in contracts he delivered to Wade, Cunningham was given possession of a yacht called the Buoy Toy, which he eventually renamed the Duke-Stir. Wade had purchased it for Cunningham with a cashier’s check for $140, 000. According to the bribe menu, Cunningham would get another $50, 000 for every additional $1 million he got Wade in contracts. But after getting to $20 million, there was a discounted rate by which he would get $25, 000 per million in contracts. That’s why Cunningham was so intense about winning contracts through federal earmarks—he’d bully his own staff and staffers on the Appropriations Committee to make sure he got the earmarks he wanted.24
But the corruption went far beyond Cunningham’s committee. In October 2006, Jane Harman, then the ranking Democrat on the House Intelligence Committee, released an internal congressional investigation into Cunningham’s activities that uncovered “major breakdowns” in the oversight process.25 “To ensure that MZM received government contracts worth tens of millions of dollars,” the report said, Cunningham and Wade needed the cooperation of dozens of people. Among them were “the appropriators and authorizers in Congress, who carried Cunningham’s funding requests (or ‘adds’) and wrote the language directing how they were to be used; the various Department of Defense (‘DOD’) officials responsible for execution of the money, awarding contracts and preparing the Statements of Work; and officials of the agencies for which the contracts were to be performed. This was a lot of people to persuade, cajole, deceive, pressure, intimidate, bribe or otherwise influence to do what they wanted.”26 The intelligence committee’s ability to conduct appropriate oversight over CIFA and other agencies “appears to have been seriously impeded by the corrupt conspiracy between Cunningham and Wade,” the House report concluded.
Despite the Democratic majority’s pledge in January 2007 to cut back on such earmarks, the practice continues unabated. In its voluminous report accompanying the 2007 intelligence budget, the House Intelligence Committee for the first time released a list of earmarked intelligence projects, their cost, and their congressional sponsors. They added up to $95 million, and went to twenty-six projects earmarked by eleven lawmakers from both sides of the political aisle.* And according to an analysis of earmarks published in the fall of 2007 by Taxpayers for Common Sense, a Washington-based watchd
og group, the House version of a $460 billion defense bill included 1, 337 earmarks totaling $3 billion, with slightly more than half of that, $1.8 billion, going to projects the Pentagon did not request.27 Only time will tell how many other Duke Cunninghams and MZMs are waiting to happen in the House and Senate. Given the wall of secrecy that shrouds intelligence contracts, the opportunities for corruption are extensive.
In conclusion, it’s not just the secrecy, or the corruption, or the cronyism, or the lack of oversight that’s wrong with intelligence contracting: it’s also the extent of outsourcing itself, and the way it’s carried out. The government, as we just saw, has yet to spell out what intelligence functions are safe to outsource and which ones are not; in the language of the House Intelligence Committee, there is no clear definition of what is “inherently governmental.” As a result, decisions about contracting are still being made on the fly, with little regard for their short-and long-term consequences. We first saw that in Abu Ghraib, where contractors were responsible for some of the abuse at the Iraqi prison, and we saw it in the failure of the justice system to properly investigate the companies involved. We saw it in the vast swathes of the CIA’s work that is being handled by companies such as BAE Systems, General Dynamics, Scitor, and Abraxas, and in the millions of dollars worth of contracts being awarded for intelligence analysis. We saw it at the NSA, where the cooperation of the private sector—including telecom providers and IT companies—is so critical that, according to Dick Cheney, a failure by Congress to grant immunity to those companies that assisted the government in the warrantless surveillance program would put the nation in grave danger. When a Vice President of the United States has to stoop to fear-mongering to protect corporations that may have broken the law, it’s time to pull the plug on privatization.
Clearly the government will continue to rely, as it has for decades, on the private sector for key technologies, such as spy satellites, sensors, computers, and IT systems. But as the Intelligence Community flounders in its attempt to define which other tasks are inherently governmental, the American public is making up its own mind.
There is widespread agreement, for example, that military and CIA interrogations should only be carried out by government employees answering to a defined chain of command. An interrogation, after all, is where the conqueror meets the conquered, where the invader meets the insurgent, where the American meets the face of his or her enemy. Most of the people I interviewed for this book agreed with the sentiments expressed by Eugene Fidell, the military lawyer I quoted in chapter 1, that outsourcing interrogations is “playing with fire.” Even Mike McConnell, the Director of National Intelligence, seems to have reached this conclusion: “I can’t imagine using contractors for anything like that,” he told Senator Ron Wyden in 2007, when he was asked during his confirmation hearing whether he would approve the hiring of private sector interrogators.*
There also seems to be a consensus about limiting outsourcing in the area of analysis. As we’ve seen, the vast majority of intelligence spending is not going into building a cadre of experts within government but is instead creating a secret army of analysts and action officers inside the private sector. As a result, large portions of the government’s most important documents, such as the President’s Daily Brief, are being written by private contractors from companies such as Booz Allen Hamilton, SAIC, and CACI International. That needs to be reversed, radically and swiftly, so the U.S. government can once again have its own professional ranks of analysts who can inform policy-makers without worrying whether their products will meet the terms of their contracts or enhance their employers’ bottom line and future earning capabilities.
As with interrogations, there are signs that the IC itself is moving in this direction with regard to analysis. At the CIA, as we saw in chapter 4, director Michael Hayden ordered a 10 percent cut in the contractor force by the end of 2008. Moreover, some agencies now insist that analysis is out of bounds for contractors. “One point I should emphasize is that we are not outsourcing intelligence analysis,” Donald L. Black, the Chief of Public Affairs for the Defense Intelligence Agency, e-mailed me in January 2008. While the DIA does “augment our force with contractors, some of whom have unique expertise,” DIA officials are in charge of the final outcome, Black assured me. “A full-time government employee maintains authority, direction, and control over the process, and a senior analyst/leader reviews all analytic products.” That’s an important step; but it’s in our national interest to bring the entire analysis operation back into government so that Congress can have full oversight over what goes into intelligence reports. That doesn’t preclude interaction between the IC and the commercial world, academia, or even the general public; it just means interaction as equals, and with a clear demarcation between public and private.
Americans have also spoken loud and clear in the area of NSA surveillance—“communications intelligence,” as Admiral McConnell calls it. As this is being written in the winter of 2008, a fierce debate is shaking Washington over the Bush administration’s push to win retroactive immunity for the companies that helped the government spy on domestic telecommunications and Internet traffic. Despite making extreme claims in that debate that American lives were at stake, Admiral McConnell and his superiors in the Bush administration found it difficult to overcome the resistance in Congress to blanket amnesty for the companies involved in the secret and possibly illegal partnership with the Intelligence Community. This was largely due to a grassroots campaign by a determined group of citizen-bloggers who spread the word among the voting public and Congress about the issues at stake. At the same time, the popular revolt against unwarranted government and corporate intrusion into privacy encompasses a wide range of political opinion, from liberals like Senators Christopher Dodd and Russell Feingold to conservatives like Bob Barr, a former Republican lawmaker, and Bruce Fein, a former Justice Department official in the Reagan administration. It is a bipartisan consensus: national security should not trump accountability for corporations that may have broken the law.
The looming end of the Bush administration will by no means stop these debates. The national dialogue on contracting and outsourcing that began with Abu Ghraib and continues with Blackwater and the telecom amnesty will be played out through 2008 and well into the next administration. It’s going to take years, decades maybe, to get that 70 percent of the intelligence budget spent on contractors down to a tolerable and more controllable level; that will mean constant focus on the issues of accountability, transparency, and oversight. The current proposals for the Orwellian-sounding National Administration Office discussed in chapter 9 will almost certainly be left to the next president and Congress to implement or reject, meaning that discussions about expanding access of domestic security agencies to intelligence from satellites and sensors in the sky—and the role that private contractors play in that enterprise—will remain at the top of the national security agenda long after January 2009. In short, spying for hire is not going away anytime soon.
In the end, if America is to reform its intelligence apparatus, decisions about resources and structure must be made by its citizens through the government they elected—not by private sector contractors like Booz Allen Hamilton or SAIC, who are paid to determine a certain outcome. The spies for hire may not like the idea of subjecting the intelligence process to more stringent oversight, but they’re not the ones paying the bill. It’s high time that we returned intelligence to its rightful owners: the American public and its representatives in Congress.
Acknowledgments
THIS BOOK would never have seen the light of day without the support and perseverance of my agent, the incomparable John Ware. Since we first became acquainted in 2002, he has been a constant source of encouragement for my work, and his enthusiasm for this book and my writing never flagged. Thank you, John, for a job well done. Roger Labrie, my editor at Simon & Schuster, helped me refine my arguments at key points and fine-tuned my manuscript by eliminating ma
terial that was fascinating to me but not always germane to my focus. The book you read now was vastly improved by his editorial stewardship. Sarah Bershtel of Metropolitan Books planted the first seeds for this book when she called me after reading my 2002 take in The Nation on the Carlyle Group and the new blend of national security capitalism emerging during the first years of the Bush administration. Knowing the fine quality of books Sarah has published, I am proud to be on her list of interesting writers.
Chalmers Johnson, the author of Blowback: The Costs and Consequences of American Empire and other great works, was a mentor to me, and I owe him a great deal. In 1996, when I was a reporter at the Journal of Commerce, he lifted me up out of obscurity after I broke an important story that revealed for the first time that the United States played a significant background role in a violent 1980 military crackdown in South Korea. A few weeks later, Chalmers sent me a three-page, single-spaced fax praising the piece and inviting me to speak at a conference in San Francisco on the legacy of the Cold War. Later, he told my story about the U.S. role in the 1980 coup in Blowback. By making me feel that my years of work and research on U.S. foreign policy were worthwhile, Chalmers helped launch my second career as an independent journalist. He is also noteworthy for his courage and honesty as an intellectual who was able to question his earlier support for the Vietnam War and forge a new way of looking at America and its past.
