[Dialogue] Ending War for Profit

[Harry Wainwright]

Published on Saturday, September 29, 2007 by The
<http://www.thenation.com/blogs/edcut?bid=7&pid=237655>  Nation 

Ending War for Profit

by Katrina Vanden Heuvel

Based on the work of Nobel Prize-winning economist Joseph E. Stiglitz and
Harvard public finance lecturer Linda J. Bilmes, the American Friends
Service Committee <http://www.afsc.org/>  (AFSC) recently determined
<http://support.afsc.org/site/PageNavigator/DefundRefundPetition>  that the
Iraq war costs $720 million per day, $500,000 per minute - enough to provide
homes for nearly 6,500 families, or health care for 423,529 children in just
one day.

AFSC is using ten, seven-foot banners displayed at legislative and
congressional offices around the country to illustrate the costs of the war
and the human needs that could be addressed with those same resources. The
National Priorities <http://nationalpriorities.org/>  Project (NPP) also has
a new
<http://www.nationalpriorities.org/Publications/More-War-Funding-Requested-3
.html>  report on the Bush Administration's latest $50 billion spending
request, which would bring the total cost of the Iraq War to $617 billion.

In addition to these staggering costs, we're also learning more about how
this war has served as a boondoggle for defense contractors, with war
profit-making gone out of control. The Nation's Jeremy Scahill was way ahead
of the curve in reporting on Blackwater
<http://www.thenation.com/doc/20071015/scahill> 's role in the most
radically privatized, outsourced war in history. (Last week, Jeremy was
asked to testify <http://www.thenation.com/doc/20071008/scahill0921>  before
the Democratic Policy Committee about his work and reporting-which may well
lead to some good reforms. )

The Institute <http://www.ips-dc.org/>  for Policy Studies and United for a
<http://www.faireconomy.org/>  Fair Economy has done important research in
this area. Here are some of the more disturbing facts: CEOs of defense
contractors are paid more in four days than a general earns in a year; since
September 11, CEOs at top defense contractors have received annual pay gains
between 200 percent to 688 percent; between 2002 and 2006, the seven highest
paid defense contractor CEOs made nearly $500 million - General Dyanmics'
CEO, Nicholas Chabraja, alone was paid $97.9 million, averaging $19.6
million per year. (David Lesar of Halliburton pocketed a mere $16 million
per year during that period, and Lockheed Martin's Robert Stevens has cashed
in on stock options to earn over $19 million so far this year.) Many of the
CEOs profitted from stock options as their companies' stock prices soared
with the increased revenues from the Defense Department.

Sarah Anderson <http://www.ips-dc.org/bios.htm#Sarah%20Anderson> , Director
of the Global Economy Program at the Institute for Policy Studies, and
Charlie Cray, Director of the Center <http://www.corporatepolicy.org/>  for
Corporate Policy, suggest that defense contractors' CEO pay be addressed
directly by conditioning contracts on reasonable pay practices. For example,
requiring that the CEO not make more than 25 times the lowest paid worker
within the company or, alternatively, not more than 10 times the pay of a
military general. This could be combined with other eligibility criteria
such as no companies that relocated offshore, have a history of significant
violations, or do business with states that sponsor terrorism. (Also, the
disclosure rules for defense contractors should be broadened. Right now,
privately held corporations are not required to make public their executive
compensation. Thus, major players like Bechtel and Blackwater
<http://www.thenation.com/doc/20070402/scahill>  can keep their pay figures
secret.) But Anderson and Cray believe that CEO pay is a symptom of a much
broader problem - one that will only be addressed if we recognize that the
entire defense and war contracting system is out of control.

"Companies like Halliburton/KBR and Blackwater are only the tip of the
iceberg," Anderson says. "We now have contractors conducting intelligence
background checks, processing Freedom of Information Act Requests, writing
the President's daily brief, helping run prisons like Abu Ghraib, etc."

After years of almost zero oversight, these broader questions are finally
being examined - at least to a degree. Certainly Representative Henry Waxman
is doing his part as Chair of the House Committee on Government Oversight
and Reform, looking at Iraq reconstruction corruption. And Senators Claire
McCaskill and Jim Webb introduced legislation to establish a Commission on
Wartime Contracting - a Truman-like Commission - to investigate waste and
fraud in contracting. (Anderson and Cray suggest that the mandate for the
Commission be broadened to look at the corporatization of war, intelligence,
and other inherently governmental functions.) Other common-sense pieces of
legislation include: the "Transparency and Accountability in Security
Contracting Act", introduced by Rep. David Price, to ensure that private
security contractors like Blackwater are accountable; and two 2006 contract
reform bills - Rep. Waxman's "Clean Contracting Act" and Sen. Byron Dorgan's
"Honest Leadership in Government Contracting Act" - both bills would limit
no-bid contracts, provide criminal sanctions for fraud, and address
conflicts-of-interest, revolving door and other issues.

It is a systemic problem for a democracy to link corporate profits and
war-making, and it has metastasized as this war has been increasingly
privatized (there are now more contractors than soldiers in Iraq). Good
small-d democrats need to keep watch on current legislation, hold our
representatives accountable and demand that they take bolder action to bring
this system to an end.

Katrina Vanden Heuvel is editor of The Nation <http://www.thenation.com/> .

C 2007 The Nation

Article printed from www.CommonDreams.org 

URL to article: http://www.commondreams.org/archive/2007/09/29/4200/

 

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