craschworks

Sickening…first steel subsidies, and farm support, now this. Bush's economic policies are terrible…

http://www.nytimes.com/2002/09/01/business/yourmoney/01EXIM.html?todaysheadlines=&pagewanted=print&position=top

The New York Times
September 1, 2002
A Guardian of Jobs or a 'Reverse Robin Hood'?
By LESLIE WAYNE

WASHINGTON — It is hard to imagine why Thaksin Shinawatra, a billionaire
who is Thailand's prime minister, would need a helping hand from the United
States government for his family business, an Asian telecommunications
giant called the Shin Corporation.

The Shin business empire, which Mr. Shinawatra founded and is still
majority owned by his family, spreads from India to Indochina. It is
Thailand's largest telecommunications company. But last May, to the
consternation of competitors, Shin Satellite, a subsidiary, won a $160
million loan guarantee from the Export-Import Bank of the United States to
buy a new telecommunications satellite and strengthen its grip in Southeast
Asia.

For the bank, a Depression-era agency founded to promote exports, the
rationale was simple. Loral Space and Communications, an American
manufacturer run by Bernard L. Schwartz, a longtime Democratic Party donor,
was Shin's supplier, and commercial banks, according to the bank, would not
finance the deal without the loan guarantee.

Crying foul, Shin Satellite's competitors tried to block the deal in
Congress. “How is it that billionaires like Shinawatra and Bernie Schwartz
can get the U.S. taxpayers to subsidize their deals?” asked Franklin G.
Polk, a lobbyist for New Skies Satellites, a rival based in the Netherlands
that, like other companies, was able to get private financing, but not at
the rates as low as Shin's government-backed loans.

How indeed?

At a time when the Bush administration says it wants to cut back on
corporate welfare, the Export-Import bank, often called a “reverse Robin
Hood” for taking money from American taxpayers and giving it to wealthy
corporations, is growing. In June, while the public was focused on
corporate scandals, President Bush quietly signed legislation to double the
scope of the bank's operations and allow it to provide up to $100 billion
in international trade assistance at any one time.

Even before this increase, Export-Import was already by far the largest
federal agency providing international credit aid, outpacing international
food and disaster aid programs. The bank has long expanded beyond its
initial mission of aiding American exporters when times were tough. And a
growing chorus of critics – from free traders on the right to trade
unionists on the left – say the bank has become a tool for an elite group
of politically well-connected corporations to get sweetheart deals and
cheap financing courtesy of American taxpayers.

“We already regard Ex-Im as the poster boy for the anti-corporate-welfare
movement,” said Stephen Moore, an analyst at the Cato Institute, a
Washington research group that promotes free trade. “It's a huge amount of
money that goes to the wealthiest corporations. There is no rationale for
the government to be involved in this.”

In fact, Export-Import policies in recent years have had the perverse
effect of sending American jobs, rather than goods and services, overseas.
There was, for example, the case of a Chinese steel mill, the Benxi Iron
and Steel Group, that received an $18 million Export-Import backed loan in
December 2000 to buy American-made equipment only to be found a year later
to be dumping steel into American markets and slapped with a 90 percent
antidumping tariff. In that year, steel companies in the United States laid
off 30,000 workers and more than 20 of the companies filed for bankruptcy.

More fundamentally, there are questions about why the bank exists at all.
Less than 1 percent of all American exports receive Export-Import
financing, which comes in the form of direct loans, loan guarantees or
export credit insurance. The bulk of Export-Import's benefits go to a small
number of large companies that are sophisticated enough to get financing on
their own: Boeing, Halliburton, General Electric, Northrop Grumman, Lucent
Technologies, ChevronTexaco, Caterpillar and Dell Computer, among others.

“This is naked corporate welfare,” said Representative Ron Paul, a Texas
Republican and one of a handful of Congressional critics. “It never ceases
to amaze me how members of Congress who criticize welfare for the poor on
moral and constitutional grounds see no problem with the even more
objectionable programs that provide welfare for the rich.”

But there is a clear reason the bank thrives, no matter who occupies the
White House or the top jobs in Congress. While the bank cannot lobby for
itself, its beneficiaries can.

“You have an incredibly well-funded lobbying operation led by companies
that are not only campaign contributors but also talk about creating jobs,”
said Thomas A. Schatz, president of Citizens Against Government Waste, a
public interest group. “That's a big rallying cry for members of Congress.
They think that jobs will help them get re-elected, and once you say that
jobs are at risk in their district, they go running for cover.”

Money has always flowed from the bank to the politically savvy. In its
heyday, Enron was one of the bank's biggest beneficiaries, receiving a
total of $675 million in aid since 1994. Enron's former chairman, Kenneth
L. Lay, was one of the bank's most active supporters, buttonholing
politicians on all levels of government on its behalf, including George W.
Bush when he was governor of Texas, according to memos and letters in the
Texas State Library and Archives Commission. (The Justice Department is
investigating Enron's dealings with all federal agencies, including the
Export-Import bank.)

These days, blue-chip companies have even formed a trade association, the
Coalition for Employment Through Exports, whose sole job is to protect the
bank from budget cutters. Members include Washington lobbying powerhouses
like the United States Chamber of Commerce, the National Association of
Manufacturers and companies like United Parcel Service, Verizon
Communications, United Technologies, Bechtel, Oracle, Citigroup and Bank of
America.

“We have a highly organized set of trade associations and, through them, a
large number of companies that depend on Ex-Im,” said Edmund B. Rice,
president of the coalition. “We use the resources of our members to help
make our case and apply that clout to the administration and members of
Congress.”

Not only are these companies major campaign contributors to members of
Congress, they often are leading employers in many Congressional districts,
not shy about dispatching top executives or plant managers to plead the
bank's case on Capitol Hill. Export-Import works hand-in-glove with these
lobbyists, giving them the ammunition they need.

The bank keeps an extensive data bank that breaks down all the deals it has
done, Congressional district by Congressional district, subcontractor by
subcontractor, and contains the names of 300,000 executives with whom it
has met. From it, a lobbyist can get tailor-made information on
Export-Import activities going back five years to make the bank's case.

“In administration after administration, Export-Import was always on the
top of the list to get cut,” said Mr. Moore at Cato. But he added that such
efforts “have never succeeded because of the full-court lobbying blitz by
Fortune 500 companies.”

“We've never succeeded in pulling the plug on it,” he said.

Rather, the bank is so flush that it has begun to spend some of its vast
resources on industries that may not appear to need help.

For instance, the bank recently started a program to support one of the
nation's strongest exporters, the film industry. Among the first four
independent films to receive Export-Import loan guarantees is a story of
troubled youth called `The United States of Leland,' produced by and
starring Kevin Spacey, the Oscar-winning actor. Other films with
Export-Import backing are about a lethal virus, a military project gone
awry and a reality show.

A bank news release says the film project is to “promote more U.S.-based
film production and preserve entertainment jobs in the United States.” That
said, only 51 percent of the film's budget needs to be spent on American
goods and services, which can include the salaries of American stars. Nor
is there a requirement that the films be shot in the United States,
although these four will be.

“I've never met a government agency so willing to be helpful,” said Lewis
Horwitz, a financial backer of independent films who is getting
Export-Import aid for four films.

The bank's own experience, surviving so many attempts on its life, could
make a movie script.

When Mr. Bush took office, his administration called for a 25 percent cut
in the bank's budget as part of an effort “to reduce subsidies that
primarily benefit corporations rather than individuals,” according to a
White House statement on the 2002 budget. But Mr. Bush has now endorsed a
five-year expansion plan that will increase the total value of the loans
the bank can guarantee to $100 billion from the $56 billion currently
outstanding.

The increase breezed through Congress. When the Bush administration first
tried to cut the program, 31 senators, including top Republicans, sent a
letter to the president opposing his action. The legislation to expand
Export-Import's reach passed the House, on a vote of 344 to 78, and was
approved by unanimous consent in the Senate.

“We said to Congress, `This is what we need,' ” said Eduardo Aguirre, a
former Bank of America executive in Texas and the bank's vice chairman.
“And they said `O.K.' “

Facing political reality, Mr. Bush has joined the chorus singing the bank's
praises. An administration spokesman said a new policy, allowing the bank
to guarantee more loans against fewer reserves, and thus requiring less
government money while increasing risk, had earned it points in the White
House.

During a meeting in May with President Vladimir V. Putin of Russia, Mr.
Bush actually promoted the bank as the way to finance a $2.9 billion
Caspian Sea pipeline that the two leaders favor. While nothing official has
been announced, the companies involved in this project are BP, Exxon Mobil
and ChevronTexaco.

Commercial banks, meanwhile, love Export-Import loan guarantees because
they turn corporate loans for business in risky places into risk-free
loans. If a corporate borrower halts payments on an Export-Import backed
loan, the federal government must step in and pay it off. The bank claims a
default rate of less than 2 percent.

American exporters love it even more. With an Export-Import loan guarantee,
they can borrow money from banks at lower rates and more favorable terms
than usual. And if they get into a jam overseas, the Export-Import bank can
be a powerful ally. “You've got the full weight of our U.S. embassy, our
ambassador, the Treasury Department here and overseas, the State
Department, all coming in,” said Mr. Rice at the export coalition. On the
other hand, small businesses, which often need the help more than large
companies, get short shrift from the bank, despite Congressional pressure
to change that practice. Only 18 percent of the bank's financing last year
went to small business, down from 21 percent in 1998.

Moreover, in its eagerness, the Export-Import bank rarely if ever analyzes
the larger economic impact of its programs and its executives acknowledge
that they cannot determine exactly how many jobs – if any – have been
created or saved by its financing. Last week, environmentalist groups sued
the bank, seeking to force it to consider potential global-warming effects
of projects it backs.

Yet Export-Import officials, having heard it all before, bat it away.

“People who say it's corporate welfare do not understand Ex-Im,” Mr.
Aguirre said. “Our mission is jobs. Jobs to support exports. Well-paying
jobs. What they say is corporate welfare I say is sustaining jobs. We are
here to finance exports that would not take place without Ex-Im financing.
Tell that to the people who would not have jobs without us.”

By far the biggest user of the bank's financing is Boeing, which last year
received $2.5 billion in loan guarantees, more than one-quarter of the
bank's $9.2 billion in transaction volume. This aid helped win aircraft
sales for Boeing to China, Austria, Ireland, South Korea, Turkey and Chile
that otherwise might have gone to rival Airbus. Some even call the bank
“the Bank of Boeing.”

Cheryl Russell, director for federal affairs at Boeing, said: “These deals
might not have gone forward without Ex-Im. We are the largest exporter of
manufactured goods in the U.S., so it is logical that we are the No. 1 user
of the bank. Our overseas sales are growing at a much faster rate than our
U.S. sales. That makes Ex-Im even more important to us in the future.”

Some Boeing workers have a different view.

Workers at the company's plant in Wichita, Kan., fume about the seepage of
their jobs, particularly work involving tail sections, to manufacturers in
China under deals backed by the Export-Import Bank. In the last two years,
the bank has provided $791.5 million in aid to help Boeing sell planes to
Chinese airlines in deals that often require some parts of the planes to be
built in China.

“Why in the world would you permit the use of taxpayer money to finance
deals that drain our national industrial and skill base?” said Matt Bates,
a spokesman for the International Association of Machinists and Aerospace
Workers, which represents Boeing workers.

“There were huge scandals in this country 25 years ago when aircraft
executives were found to be sealing deals by handing over briefcases of
money,” he added. “That's been outlawed. Yet it is perfectly legal for
companies to seal aircraft deals by agreeing to transfer tens of thousands
of highly skilled jobs to other countries with taxpayer money.”

Boeing says such offshore manufacturing arrangements are an inevitable cost
of doing business.

“As with most large international companies with extensive overseas sales,
foreign buyers expect to have a certain amount of manufacturing work that
accompanies the sale,” Ms. Russell said.

Perhaps no recent single transaction causes as much furor as the $18
million China steel deal. The bank provided the loan guarantees over
vigorous protests from the steel industry and unions.

“Why are they pouring money into other countries to build additional steel
capacity?” asked George Becker, a former president of the United
Steelworkers of America, who has testified about the bank before Congress.
“This isn't trade. It's dismantling our manufacturing base and robbing our
workers of their right to earn a living.”

Terrence D. Straub, a lobbyist for United States Steel and a member of the
Export-Import bank advisory board, said: “The China steel deal really
reflected an arrogance by the lending officials at Ex-Im. All the red flags
were there, and they were waved vigorously. The deal did not make sense.”

That aid package prompted insertion of a provision in the Export-Import
bill signed by President Bush to prevent similar deals from happening again
and led to legislation that cut $18 million from Export-Import budget.

But the same issue has come up again. Last month, after protests from the
Ohio and Pennsylvania Congressional delegations and the steel industry, the
bank announced that it was dropping plans to provide $19 million in loan
guarantees for a Turkish steel company to buy American-made equipment.

“We pounded on this one like hell,” said Gary Hubbard, a spokesman for the
United Steelworkers of America.

Still, the bank is considering a $35 million financing to a Mexican company
for the purchase of American-made equipment that would increase its
automotive crankshaft production by 700,000 units a year; the crankshafts
would then be exported to the United States, where American auto workers do
the same job, but for higher wages.

The bank is also deciding on a $14 million loan guarantee to an American
company, which it would not identify, so that a Mexican company, which it
also would not identify, can increase output of aluminum engine blocks by
550,000 units a year – with the output to be shipped to the United States.
Bank officials declined to say whether these projects would cause a loss in
American automaking jobs.

“Is this the best way to create U.S. jobs?” asked Representative Bernard
Sanders, the Vermont independent and one of the few Congressional critics.
“Absolutely not. Export-Import is generous with taxpayer dollars and we get
nothing in return. It's vulgar. At a time when we are having a real crisis
in this country and are losing jobs, Ex-Im is sending them overseas. Yet
these are the most important corporations in the United States and they get
what they want in Washington.”

In the debate over the recent Export-Import legislation, an attempt by
Representatives Sanders and Paul to deny aid to American companies shifting
jobs overseas failed on a vote of 283 to 135.

It's no accident that the votes are so lopsided.

“As a staff member for a congressman, you can call up Ex-Im and say, `My
congressman represents District 13 in the state of whatever,' ” said a
Treasury official. “They will spit out a report saying, `Here are the
businesses by name in your district that receive Ex-Im help.' The bank is
politically savvy. It's active in promoting its products in each
Congressional district.”

The bank also knows how to make individual legislators look good before
voters. One of its biggest outreach efforts is seminars throughout the
country, about one a week, that bring together local executives and
Export-Import officials to promote its programs. Whom does it also invite,
to show voters the benefits that Washington brings to Main Street? Each
district's local Congressional delegation, which can take credit for what
Export-Import has done.

– —————– R. A. Hettinga The Internet Bearer Underwriting Corporation 44 Farquhar Street, Boston, MA 02131 USA “… however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience.” — Edward Gibbon, 'Decline and Fall of the Roman Empire'

Whoever did this knew exactly what they were doing. Gosh, I wish I could've been there…

“…In the early 1960s, Norma Stingley, a chemical engineer, accidentally created a plastic product that bounced uncontrollably. He offered the product to Melin and Knerr and the SUPERBALL® was created, followed by the Super Gold Ball, Super Baseball and Super Dice. In one celebrated incident, a giant SUPERBALL, produced as a promotional item, was accidentally dropped out of a 23rd floor hotel window in Australia. It shot back up 15 floors, then down again into a parked convertible car. The car was totaled but the ball survived the “test” in perfect condition…”

Hey kids!

Sing along with “The Elements” Song by Tom Lehrer. Flash animation by Mike Stanfill.

I've already recommended this song before, but at the time I only had a link to a RealAudio file of the song. So here's the mp3 of “Waters of March“, one of my favorite songs. It always cheers me up when I listen to it.

Unfortunately, I found out about it via a rather sad means–a Fresh Air tribute to the singer, Susannah McCorkle, following her suicide on May 19, 2001.

http://www.nytimes.com/2002/10/13/business/yourmoney/13MILI.html?pagewanted=print&position=top

October 13, 2002
America's For-Profit Secret Army
By LESLIE WAYNE

With the war on terror already a year old and the possibility of war against Iraq growing by the day, a modern version of an ancient practice — one as old as warfare itself — is reasserting itself at the Pentagon. Mercenaries, as they were once known, are thriving — only this time they are called private military contractors, and some are even subsidiaries of Fortune 500 companies.

The Pentagon cannot go to war without them.

Often run by retired military officers, including three- and four-star generals, private military contractors are the new business face of war. Blurring the line between military and civilian, they provide stand-ins for active soldiers in everything from logistical support to battlefield training and military advice at home and abroad.

Some are helping to conduct training exercises using live ammunition for American troops in Kuwait, under the code name Desert Spring. One has just been hired to guard President Hamid Karzai of Afghanistan, the target of a recent assassination attempt. Another is helping to write the book on airport security. Others have employees who don their old uniforms to work under contract as military recruiters and instructors in R.O.T.C. classes, selecting and training the next generation of soldiers.

In the darker recesses of the world, private contractors go where the Pentagon would prefer not to be seen, carrying out military exercises for the American government, far from Washington's view. In the last few years, they have sent their employees to Bosnia, Nigeria, Macedonia, Colombia and other global hot spots.

Motivated as much by profits as politics, these companies — about 35 all told in the United States — need the government's permission to be in business. A few are somewhat familiar names, like Kellogg Brown & Root, a subsidiary of the Halliburton Company that operates for the government in Cuba and Central Asia. Others have more cryptic names, like DynCorp; Vinnell, a subsidiary of TRW; SAIC; ICI of Oregon; and Logicon, a unit of Northrop Grumman. One of the best known, MPRI, boasts of having “more generals per square foot than in the Pentagon.”

During the Persian Gulf war in 1991, one of every 50 people on the battlefield was an American civilian under contract; by the time of the peacekeeping effort in Bosnia in 1996, the figure was one in 10. No one knows for sure how big this secretive industry is, but some military experts estimate the global market at $100 billion. As for the public companies that own private military contractors, they say little if anything about them to shareholders.

“Contractors are indispensible,” said John J. Hamre, deputy secretary of defense in the Clinton administration. “Will there be more in the future? Yes, and they are not just running the soup kitchens.”

That means even more business, and profits, for contractors who perform tasks as mundane as maintaining barracks for overseas troops, as sophisticated as operating weapon systems or as secretive as intelligence-gathering in Africa. Many function near, or even at, the front lines, causing concern among military strategists about their safety and commitment if bullets start to fly.

The use of military contractors raises other troubling questions as well. In peace, they can act as a secret army outside of public view. In war, while providing functions crucial to the combat effort, they are not soldiers. Private contractors are not obligated to take orders or to follow military codes of conduct. Their legal obligation is solely to an employment contract, not to their country.

Private military contractors are flushing out drug traffickers in Colombia and turning the rag-tag militias of African nations into fighting machines. When a United Nations arms embargo restricted the American military in the Balkans, private military contractors were sent instead to train the local forces.

At times, the results have been disastrous.

In Bosnia, employees of DynCorp were found to be operating a sex-slave ring of young women who were held for prostitution after their passports were confiscated. In Croatia, local forces, trained by MPRI, used what they learned to conduct one of the worst episodes of “ethnic cleansing,” an event that left more than 100,000 homeless and hundreds dead and resulted in war-crimes indictments. No employee of either firm has ever been charged in these incidents.

In Peru last year, a plane carrying an American missionary and her infant was accidentally shot down when a private military contractor misidentified it as on a drug smuggling flight.

MPRI, formerly known as Military Professionals Resources Inc., may provide the best example of how skilled retired soldiers cash in on their military training. Its roster includes Gen. Carl E. Vuono, the former Army chief of staff who led the gulf war and the Panama invasion; Gen. Crosbie E. Saint, the former commander of the United States Army in Europe; and Gen. Ron Griffith, the former Army vice chief of staff. There are also dozens of retired top-ranked generals, an admiral and more than 10,000 former military personnel, including elite special forces, on call and ready for assignment.

“We can have 20 qualified people on the Serbian border within 24 hours,” said Lt. Gen. Harry E. Soyster, the company's spokesman and a former director of the Defense Intelligence Agency. “The Army can't do that. But contractors can.”

For that, MPRI is paid well. Its revenue exceeds $100 million a year, mainly from Pentagon and State Department contracts. Retired military personnel working for MPRI receive two to three times their Pentagon salaries, in addition to their retirement benefits and corporate benefits like stock options and 401(k) plans. MPRI's founders became millionaires in July 2000, when they and about 35 equity holders sold the company for $40 million in cash to L-3 Communications, a military contractor traded on the New York Stock Exchange.

Within the military, the use of contractors is Defense Department policy for filling the gaps as the number of troops falls. At the time of the gulf war, there were 780,000 Army troops; today there are 480,000. Over the same period, overall military forces have fallen by 500,000.

Pentagon officials did not respond to many telephone calls and e-mail messages requesting interviews, but they have maintained that contractors are a cost-effective way of extending the military's reach when Congress and the American public are reluctant to pay for more soldiers.

“The main reason for using a contractor is that it saves you from having to use troops, so troops can focus on war fighting,” said Col. Thomas W. Sweeney, a professor of strategic logistics at the Army War College in Carlisle, Pa. “It's cheaper because you only pay for contractors when you use them.”

But one person's cost-saving device can be another's “guns for hire,” as David Hackworth, a former Army colonel and frequent critic of the military, called them.

“These new mercenaries work for the Defense and State Department and Congress looks the other way,” Colonel Hackworth, a highly decorated Vietnam veteran, said. “It's a very dangerous situation. It allows us to get into fights where we would be reluctant to send the Defense Department or the C.I.A. The American taxpayer is paying for our own mercenary army, which violates what our founding fathers said.”

They are not mercenaries in the classic sense. Most, but not all, private military contractors are unarmed, even when they oversee others with guns. They have even formed a trade group, the International Peace Operations Association, to promote industry standards.

“We don't want to risk getting contracts by being called mercenaries,” said Doug Brooks, president of the association. “But we can do things on short notice and keep our mouths shut.”

That, some critics say, is part of the problem. By using for-profit soldiers, the government, especially the executive branch, can evade Congressional limits on troop strength. For instance, in Bosnia, where a cap of 20,000 troops was imposed by Congress, the addition of 2,000 contractors helped skirt that restriction.

Contractors also allow the administration to carry out foreign policy goals in low-level skirmishes around the globe — often fueled by ethnic hatreds and a surplus of cold war weapons — without having to fear the media attention that comes if American soldiers are sent home in body bags.

At least five DynCorp employees have been killed in Latin America, with no public outcry. Denial is easier for the government when those working overseas do not wear uniforms — they often wear fatigues or military-looking clothes but not official uniforms.

“If you sent in troops, someone will know; if contractors, they may not,” said Deborah Avant, an associate professor of political science at George Washington University and author of many studies on the subject.

Only a few members of Congress have expressed concern about the phenomenon.

“There are inherent difficulties with the increasing use of contactors to carry out U.S. foreign policy,” said Senator Patrick J. Leahy, Democrat of Vermont and the chairman of the foreign operations subcommittee. “This is especially true when it involves `private' soldiers who are not as accountable as U.S. military personnel. Accountability is a serious issue when it comes to carrying guns or flying helicopters in pursuit of U.S. foreign policy goals.”

In the House, Representative Jan Schakowsky, an Illinois Democrat, led the battle against a Bush administration effort to remove the cap that limits the number of American troops in Colombia to 500 and private contractors to 300.

“American taxpayers already pay $300 billion a year to fund the world's most powerful military,” Ms. Schakowsky said. “Why should they have to pay a second time in order to privatize our operations? Are we outsourcing in order to avoid public scrutiny, controversy or embarrassment? Is it to hide body bags from the media and thus shield them from public opinion?”

SUCH concerns are hardly slowing the pace across the Potomac, at MPRI in Alexandria, Va. The company may look like hundreds of other white-collar concerns that fill small office buildings in northern Virginia, but there are telltale signs to the contrary: the sword that serves as the corporate logo and conference rooms named the Infantry Room, the Cavalry Room and the Artillery Room. Its art consists of paintings of celebrated battles, largely from the Civil War.

It's hard to tell where the United States military ends and MPRI begins. For the last four years, MPRI has run R.O.T.C. training programs at more than 200 universities, under a contract that has allowed retired military to put their uniforms back on. It recently lost the contract to a lower bidder, but MPRI offset the loss with one to provide former soldiers to run recruitment offices.

The company, which has 900 full-time employees, helps run the United States Army Force Management School at Fort Belvoir. It also provides instructors for advanced training classes at Fort Leavenworth, teaches the Civil Air Patrol and designs courses at Fort Sill, Fort Knox, Fort Lee and other military centers.

The Pentagon has even hired MPRI to help it write military doctrine — including the field manual called “Contractors Support on the Battlefield” that sets rules for how the Army should interact with private contractors, like itself.

Overseas, MPRI is, if anything, more active. Under a program it calls “democracy transition,” the company has offered countries like Nigeria, Bosnia, Saudi Arabia, Taiwan, Ukraine, Croatia and Macedonia training in American-style warfare, including war games, military instruction and weapons training.

In Croatia, MPRI was brought in to provide border monitors in the early 1990's. Then, in 1994, as the United States grew concerned about the poor quality of the Croatian forces and their ability to maintain regional stability, it turned to MPRI. A United Nations arms embargo in 1991, approved by the United States, prohibited the sale of weapons or the providing of training to any warring party in the Balkans. But the Pentagon referred MPRI to Croatia's defense minister, who hired the company to train its forces.

In 1995, MPRI started doing so, teaching the fledgling army military tactics that MPRI executives had developed while on active duty commanding the gulf war invasion. Several months later, armed with this new training, the Croatian army began Operation Storm, one of the bloodiest episodes of “ethnic cleansing” in the Balkans, an event that also reshaped the military balance in the region.

The operation drove more than 100,000 Serbs from their homes in a four-day assault. Investigators for the international war crimes tribunal in the Hague found that the Croatian army carried out summary executions and indiscriminately shelled civilians. “In a widespread and systematic matter, Croatian troops committed murder and other inhumane acts,” investigators said in their report. Several Croatian generals in charge of the operation have been indicted for war crimes and are being sought for trial.

“No MPRI employee played a role in planning, monitoring or assisting in Operation Storm,” said Lieutenant General Soyster, the MPRI spokesman. He did say that a few Croatian graduates of MPRI's training course participated in the operation.

Yet what happened in Croatia gave MPRI international brand recognition and more business in that region. When Bosnian Muslims balked in 1995 at signing the Dayton peace accords out of fear that their army was ill-equipped to provide sufficient protection, MPRI was called in.

“The Bosnians said they would not sign unless they had help building their army,” said Peter Singer, a foreign policy fellow at the Brookings Institution who is writing a book on contractors. “And they said they wanted the same guys who helped the Croatians.”

That is who they got. Under a plan worked out by American negotiators, the Bosnian Muslims hired MPRI using money that was provided by a group of Islamic nations, including Saudi Arabia, Kuwait, Brunei, the United Arab Emirates and Malaysia. These nations deposited money in the United States Treasury, which MPRI drew against.

“It was a brilliant move in that the U.S. government got someone else to pay for what we wanted from a policy standpoint,” Mr. Singer said.

At the moment, MPRI is advertising for special forces for antiterrorist operations, is bulking up to train American forces in Kuwait and is looking for people with special skills like basic-training instruction and counterintelligence. Recently, however, it lost a $4.3 million contract to provide training to the army in Colombia when officials there complained about what they called the poor quality of MPRI's services.

In Africa, MPRI has conducted training programs on security issues for about 120 African leaders and more than 5,500 African troops. Most recently, it went toe to toe with the State Department, and won, gaining permission to do business in Equatorial Guinea, a country with a deplorable human rights record where the United States does not have an embassy.

After two years of lobbying at the State Department, and after being turned down twice on human rights grounds, MPRI was finally given approval last year to work with President Teodoro Obiang Nguema, whom the State Department describes as holding power through torture, fraud and a 98 percent election mandate. MPRI advised President Obiang on building a coast guard to protect the oil-rich waters being explored by Exxon Mobil off the coast.

More recently, when MPRI and President Obiang proposed that MPRI also help the country build its police and military forces, the State Department objected and the project is now dormant.

“We thought helping the coast guard would be pretty innocuous in terms of human rights,” Lieutenant General Soyster of MPRI said. But Ms. Avant of George Washington University disagreed, saying any alliance with United States military contractors would strengthen President Obiang's power.

MPRI is not the only company to have run into problems overseas. DynCorp, a privately held company in Reston, Va., with nearly $2 billion in annual sales, has been tapped to provide protection for Mr. Karzai in Afghanistan. DynCorp also provides worldwide protective services for State Department employees.

In late September, DynCorp settled charges — for an undisclosed sum — brought by a whistle-blower the company had fired after he complained of a sex ring run by DynCorp employees in Bosnia. In August, a British court, meanwhile, ruled in favor of another former DynCorp employee in a separate whistle-blower case. DynCorp is appealing.

The two employees made similar accusations: that while working in Bosnia, where DynCorp was providing military equipment maintenance services, DynCorp employees kept underaged women as sex slaves, even videotaping a rape. Among the charges was that while the DynCorp employees trafficked in women — including buying one for $1,000 — the company turned a blind eye. Since the DynCorp employees involved were not soldiers, their actions were not subject to military discipline. Nor did they face local justice; they were simply fired and sent home.

In both cases, after complaining, the two employees who blew the whistle were fired. Ben Johnston, one of them, said last April in Congressional testimony: “DynCorp employees were living off post and owning these children and these women and girls as slaves. Well, that makes all Americans look bad. I believe DynCorp is the worst diplomat our country could ever want overseas.”

A DynCorp spokesman, Chuck Taylor, said the company “felt horrible” and held its own internal investigation before firing the employees who operated the ring.

DynCorp also handles aerial anti-narcotics efforts for the United States government in the skies over Colombia and nearby countries — where several employees have been killed. Because of Congressional caps on the use of private military contractors, DynCorp has hired local citizens; two were recently killed.

Still, in its recruiting material, the company plays up the excitement of this type of work: “Being the best is never easy and when your office is the cockpit of a twin-engine plane swooping low over the Colombian jungle, the challenges can often be enormous.”

Incidents like these — sex rings, deals with dictators, misused military training and tragic accidents — raise questions about the use of contractors. To whom are they accountable: the United States government or their contract? When such incidents occur, who bears the responsibility?

Moreover, while the general mantra about military privatization is that it saves money, there are few studies to prove the case — and in fact, reports exist to the contrary.

For instance, Kellogg Brown & Root, which was paid $2.2 billion to provide logistics support to American troops in the Balkans, was the subject of a General Accounting Office report entitled, “Army Should Do More to Control Contract Costs in the Balkans.” The office found that the Army was not exercising enough oversight on Kellogg Brown & Root as contract costs rose, to the benefit of the company. Still, the company continues to pick up new business.

Questions about security and control are even more basic. In the battlefield, a commander cannot give orders to a contractor as he can a soldier. Contractors are not compelled by an oath of office, as soldiers are, but instead by an employment contract that provides little flexibility. Nor are contractors subject to the Uniform Code of Military Justice.

Contractors cannot arm themselves — they risk losing their status as noncombatants if they do and, in the extreme, could be declared mercenaries and subject to execution if captured. Yet in the gulf war, contractors were in the thick of battle, providing maintenance to tanks and biological and chemical vehicles as well as flying air support.

Should there be a war in Iraq, the line could be even blurrier.

“There are no rear areas anymore,” Colonel Sweeney of the Army War College said. With chemical and biological weapons, “no place is safe,” he said.

“You can't draw a map and say `no contractors forward of this line,' ” he added. “The American concept of combat is to take the battle to the rear areas and be as disruptive as possible. The other guy is thinking the same thing.”

One tenet of warfare is that soldiers handling support functions can grab a gun and hit the front lines if needed. While this is often dismissed as a quaint World War II concept, it happened in Somalia in 1993 when Army rangers were in trouble and military supply clerks came to their rescue. When the support staff is filled with contractors, would they do the same? Or would commanders in the field become responsible for the safety of the growing number of contractor employees at the expense of advancing the battle?

The issue is just beginning to generate some attention in military circles.

“We sort of blur the lines,” Col. Steven J. Zamparelli of the Air Force said in an interview. In an article in 1999 for the Air Force Journal of Logistics, Colonel Zamaparelli said: “The Department of Defense is gambling future military victory on contractors' performing operational functions in the battlefield.”

Others in the military are more blunt about the effect on soldiers. “Are we ultimately trading their blood to save a relatively insignificant amount in the national budget?” said Lt. Col. Lourdes A. Castillo of the Air Force, a logistics expert, in a 2000 article in Aerospace Power Journal. “If this grand experiment undertaken by our national leadership fails during wartime, the results will be unthinkable.”

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…when they sell “Country Music Weekly” at the grocery store checkout stand.

And what better way to celebrate my arrival in the South than some X-rated country songs?

[The following country songs contain lyrics of a extremely frank and explicit nature. Listener discretion is advised. At the very least, please refrain from inserting one of these into the songlist at your next wedding. Please direct cold, disapproving stares and irate messages to my friend Toli Lerios, who was gracious enough to send them to me.]

http://www.openknowledge.org/personal/music/Do That Sexy Dance You Do.mp3
http://www.openknowledge.org/personal/music/Does It Say Gucci On Your Underwear_.mp3
http://www.openknowledge.org/personal/music/Don_t Believe That Lie I Gave You.mp3
http://www.openknowledge.org/personal/music/Girlie Magazines.mp3
http://www.openknowledge.org/personal/music/I Don_t Want Another Wife.mp3
http://www.openknowledge.org/personal/music/I Never Missed A Lick.mp3
http://www.openknowledge.org/personal/music/Love Your Neighbor.mp3
http://www.openknowledge.org/personal/music/Make Your Daddy Happy.mp3
http://www.openknowledge.org/personal/music/On The Hood Of The Car.mp3
http://www.openknowledge.org/personal/music/The Sheriff Wore A Dress.mp3

Election Methods Mailing List/FAQ

Debian Constitution

* Uprooting War
20/09/2001

http://www.uow.edu.au/arts/sts/bmartin/pubs/90uw/

Professor Brian Martin's online text examining the limitations of past anti-war efforts, as well as new strategies for the future. From the introduction: “This book is based on the assumption that action to end war must come from individuals, small groups and local communities, in short from the grassroots. Grassroots action against war has a long and inspiring history of protests, campaigns and initiatives. Unfortunately, most of this activity has had little impact on military races because it has relied on influencing elites, which is the least promising avenue for such efforts. Moreover, many antiwar actions have been symbolic protests with little connection with a long-term strategy to end war. And the protests are mainly against symptoms of the problem, such as nuclear weapons, rather than directly tackling the roots of modern war.”

* RESISTANCE TACTICS-Ch
20/09/2001

http://www.reason.com/9501/dept.bkCARPENTER.text.html

Ted Galen Carpenter's review of the 1995 book, Strategic Nonviolent Conflict: The Dynamics of People Power in the Twentieth Century by Peter Ackerman and Christopher Kruegler. From the review: “….The most tenacious myth Ackerman and Kruegler debunk is that nonviolent resistance is effective only in dealing with democratic governments that have adopted uncharacteristically repressive policies. According to that argument, peaceful demonstrations and civil disobedience can prick the conscience of democratic rulers and publics, gain the support of international opinion, and force a change of policy while totalitarian and authoritarians regimes will simply use whatever force is necessary to smash the opposition….” (contributed by Chris Rasch)

* The Literature of Nonviolent Resistance and Civilian-Based Defense
20/09/2001

http://www.humanestudiesreview.org/

In this bibliographic essay, Brian Caplan reviews strategies for non-violent defense. From the essay: “…There can be little doubt that today's foremost thinker sympathetic to nonviolent resistance is Gene Sharp. With an eye toward practical strategy rather than philosophy, his major work “The Politics of Nonviolent Action” (Boston: Porter Sargent, 1973) covers virtually every aspect of the theory and history of nonviolent resistance to government….” (contributed by Chris Rasch)