Military Privatization 101 – Making a Killing: The Business of War

Since 1994, the U.S. Defense Department has entered into 3,061 contracts with 12 U.S.-based private military companies.
Private military companies – a recently coined euphemism for mercenaries – are just one face of the increasing trend of the privatization of war. Arms dealers have profited from a massive unregulated sell off of low price surplus armaments into … Angola, Sudan, Ethiopia, Colombia, Congo-Brazzaville, Sri Lanka, Burundi and Afghanistan – where conflicts have led to the deaths of up to 10 million people during the past decade.

2002.10.28

At least 90 companies that provide services
normally performed by national military forces – but without the same degree of
public oversight – have operated in 110 countries worldwide, providing
everything from military training, logistics, and even engaging in armed combat.
Amid the global military downsizing and the increasing number of small conflicts
that followed the end of the Cold War, governments have turned increasingly to
these private military companies to intervene on their behalf around the globe,
a new investigation by the Center for Public Integrity’s International
Consortium of Investigative Journalists has found.


With the ongoing international military presence in Afghanistan and a
possible war in Iraq on the horizon, the issue of military privatization has
taken on new relevance. Since 1994, the U.S. Defense Department has entered into
3,061 contracts with 12 U.S.-based private military companies identified by ICIJ,
a review of government documents showed. Not every contract was for military
services; records obtained from the Pentagon were not specific enough to
determine the purpose of each of the contracts.

Private military companies – a recently coined euphemism for mercenaries –
are just one face of the increasing trend of the privatization of war, the
investigation found. A small group of individuals and companies with connections
to governments, multinational corporations and, sometimes, criminal syndicates
in the United States, Europe, Africa and the Middle East have profited from this
business of war.

Arms dealers have profited from a massive unregulated sell off of low price
surplus armaments into the most fragile, conflict-ridden states and failed
states. The weapons, mostly from state-owned Eastern European factories, have
found their way to Angola, Sudan, Ethiopia, Colombia, Congo-Brazzaville, Sri
Lanka, Burundi and Afghanistan – where conflicts have led to the deaths of up to
10 million people during the past decade.

The investigation profiles arms dealers like Victor Bout and Leonid Minin,
both of whom were born in the Soviet Union and, after its breakup, became
involved in the profitable trade in arms to Africa. Bout, a Russian pilot,
allegedly supplied arms to the Taliban, and was dubbed “the Merchant of Death”
for supplying weapons to a series of African conflicts. Minin, a Ukrainian, was
charged with supplying weapons that fueled a bloody war in Sierra Leone. Both
have been accused of having ties to international criminal syndicates by various
international authorities.

Natural resources including oil, diamonds, timber and the mineral coltan –
used in the manufacture of modern conveniences like cellular telephones – have
played a central role in the economics of war. Mercenaries, multinational
companies, and private investors have conspired with legitimate governments,
brutal dictators and bloody rebel leaders to turn the natural wealth of poor
countries into the currency of war commerce.

Drawing on classified intelligence files, government reports, court records
and public documents, the investigation identifies the non-state actors in this
growth industry and explains how they often influence the turn of world events.
The nearly two-year investigation, conducted by 35 writers, researchers and editors
working on four continents, will be published in 11 installments:

  • Oct. 28: Making a Killing: The Business of War – An overview of privatization of combat since the end of the Cold War:
    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=1

  • Oct. 28: Privatizing Combat, the New World Order – A look at the world of private military companies, and the issues raised by the trend of outsourcing
    war:
    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=2

  • Oct. 30: Marketing the New “Dogs of War” – How mercenaries, with the aid of public relations professionals, rebranded themselves as private military companies:
    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=3

  • Nov. 4: Greasing the Skids of Corruption – A case study of how the pursuit
    of oil in the third world fuels corruption and war:
    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=4

  • Nov. 6: The Curious Bonds of Oil Production – The U.S. government and a
    private military company court an oil rich state whose government has been
    accused of serious human rights violations:

    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=5

  • Nov. 8: Conflict Diamonds are Forever – Poor controls in the international
    diamond industry – even in South Africa – are undercutting attempts to clamp
    down on conflict diamonds that fuel wars in Africa and, possibly, fund
    terrorists:

    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=6

  • Nov. 11: The Adventure Capitalist – While Africa’s wars have brought untold
    misery to millions, some have seen conflict in the region as a business
    opportunity:

    http://www.icij.org/dtaweb/icij_bow.asp?Section=Chapter&ChapNum=7

  • Nov. 13: The Influence Peddlers – An entrepreneur with global ties to arms
    smuggling, resource exploitation and private military companies epitomizes the
    business of war;

  • Nov. 15: The Field Marshal – An arms trader who admitted to breaking a
    U.N. arms embargo also claimed ties to French intelligence, the Iranian
    government, and the since bought out oil company, Elf Aquitaine;

  • Nov. 18: Drugs, Diamonds and Deadly Cargoes – When he was arrested on a
    drug charge in Milan, Leonid Minin, an arms trader under investigation across
    Europe, had his business records with him, providing a detailed look into the
    world of war commerce;

  • Nov. 20: The Merchant of Death – Victor Bout, who has been accused of
    fueling Africa’s bloodiest conflicts, ran a global transportation network with
    bases and front companies in Europe, the Middle East, Afghanistan, South
    Africa, Equatorial Guinea, and even the United States.

The Center is also providing access to ICIJ’s searchable database that
chronicles the global operations of the private military companies. Most of the
PMCs, as they are known, are based in the United States, Britain and South
Africa, but the vast bulk of their services are performed in conflict-ridden
areas of Africa, South America and Asia.

Author: International Consortium of Investigative Journalists

News Service: The Center for Public Integrity

URL: http://www.public-i.org/dtaweb/report.asp?ReportID=469&L1=10&L2=10&L3=0&L4=0&L5=0