First some numbers. The size of the US military was cut 30 percent between 1990 and 2005, which led to increased reliance on private companies to provides services previously thought of as "inherently governmental." The wars in Iraq and Afghanistan accelerated the shift. Pentagon contracts have grown 31 percent in the last few years, from $241 billion in fiscal year 2004 to $316 billion in fiscal year 2008, and the Congressional Budget Office reports that, by year's end, the US will have shelled out over $100 billion to contractors in Iraq. One out of every five dollars spent in Iraq now goes to private industry, and there is one contractor for every US soldier in the country. (During the Gulf War, the ratio of soldiers to contractors was 50:1.)
These figures come from a New America Foundation report released Friday, called "Changing the Culture of Pentagon Contracting" (.pdf), which acknowledges the "inevitability of contractors," while making recommendations for integrating them more effectively into the US force structure. Among the report's admonishments:
The Military Extraterritorial Jurisdiction Act and other assorted laws covering military contractors should be expanded to include all contractors operating in Iraq and Afghanistan. (Contractors in Iraq have near-blanket immunity, at least for now.)
Vetting and training of contractors, particularly of Third Country Nationals, should be improved. Iraq has been a magnet for people of questionable backgrounds to use their military skills in the pursuit of a quick buck.
Move away from the concept of "inherently governmental" towards increased focus on core competency. In other words, if contractors are more effective at certain tasks, hire them. That said, "red lines" should be established to prevent certain jobs from being outsourced.
Improve the contract oversight process, which has a shared responsibility for the fraud and corruption that has accompanied use of private companies in Iraq and Afghanistan.
Train US military officers in how to coordinate their activities with private industry.
Designate a senior officer in each military branch to be responsible for a "top-to-bottom review" of how that branch is interacting with contractors to uncover areas for improvement.
Beef up the FBI's ability to investigate alleged contractor crimes overseas and appoint a US attorney to prosecute suspects as required.
Perhaps most interesting, though, is the report's recommendation that the US government move away from outsourcing private security to companies like Blackwater, which has attracted attention for numerous questionable shootings in Iraq. From the report:
Our research with respect to the activities of private security contractors in Iraq and Afghanistan to date leads us to doubt that effective control and, more importantly, sustainable accountability measures can ever be fully imposed upon those providing private security services... That is why we believe that both the U.S. military and, in particular, the Department of State should begin to move away from the use of private security contractors and develop the internal capacity to provide security protection services currently provided by the private sector.