The Spy Who Billed Me

In the post-9/11 rush to beef up intelligence, the government has outsourced everything from spy satellites to covert operations -- and well-connected companies are cashing in.

A small crowd files past a sign reading “Career Fair Today” at the Dulles Expo Center in Chantilly, Virginia, just outside Washington, D.C. An American flag and a cluster of colorful balloons flutter in the breeze. But inside, it quickly becomes clear that this is no ordinary job fair. Everybody, from the well-dressed applicants to the stern-faced recruiters, wears a badge reading “Secret” or “Top Secret.” That’s because this event is open only to candidates with an intelligence background and a government security clearance -- the more high-level, the better.

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Many of the 5,517 jobs available have something to do with the global war on terror or the occupation of Iraq. One recruiter has a position open for an “Iraq Counterterrorism Analyst.” Another is looking for personnel to “conduct interrogations of detainees” in Iraq. There is a job in Baghdad for a senior intelligence analyst and several in Fort Belvoir, Virginia, for intelligence analysts experienced in “counter-terrorism, threat analysis, and counter-narcotics.” One job looks formidable: a “deputy site manager” is needed in Baghdad to supervise “1,500-2,000 linguists providing interpreter-translator service to a 140,000-member deployed U.S. military force conducting counter-insurgency, stabilization and nation building operations.”

There’s only one thing missing: the U.S. government. Every one of these jobs is being advertised by a private company -- one of hundreds of firms that contract with the Central Intelligence Agency, the National Security Agency, or the Pentagon to provide everything from urine testers to supervisors of clandestine operations overseas. The people hired for these jobs may be doing government work in Washington or Baghdad, but they will be paid by firms such as the international consulting giant Booz Allen Hamilton or CACI International, one of the companies whose employees were implicated in prisoner abuse at Abu Ghraib.

The job fair is being sponsored by IntelligenceCareers.com, a recruitment firm headed by William D. Golden, a former Army intelligence officer. Golden says his company can hardly keep up with the demand for intelligence contractors. “The government has become addicted to the use of private industry in the world of intelligence,” he says. “In fact, they’ve made a science of it.” Indeed they have. A CIA official interviewed for this story wouldn’t say how much of the agency’s work is done by private companies, but admitted that outsourcing has increased substantially since 2001. Of the estimated $40 billion the United States is expected to spend on intelligence this year, experts say at least 50 percent will go to private contractors.

Yet as Americans learn more about the role of intelligence contractors from Afghanistan (where a contractor has been charged in connection with the death of a detainee) to Guantanamo (where Lockheed Martin has supplied interrogators, according to the trade publication Federal Times), critics are beginning to question whether private companies should be in the business of handling some of the government’s most sensitive work. Steven Aftergood, director of the Project on Government Secrecy at the Federation of American Scientists, believes that the kind of military intelligence work contracted to CACI, Titan Corp., and other companies is particularly ripe for problems because intelligence agencies “operate under unusual authority.” He adds: “I don’t think the current oversight system is equipped to monitor the activities of contractors. That is one of the central lessons of the Abu Ghraib affair.”

Like the defense industry, the intelligence business is driven by a network of lobbyists and a web of close connections between government and the private sector. But unlike the arms industry, intelligence contractors operate in a world where budgets are classified and many activities -- from covert operations to foreign eavesdropping -- are conducted in secret. Even the bidding for intelligence contracts is often classified. As a result, there is virtually no oversight of the intelligence community and its corporate partners. That was one of the central findings of the 9/11 commission, which called congressional supervision of intelligence and counterterrorism “dysfunctional.”

The outsourcing revolution began with the end of the Cold War, when hundreds of intelligence jobs were eliminated, and quickened in the mid-1990s under Vice President Al Gore’s Reinventing Government initiative. Sensing a niche, information technology companies like CACI and Titan began hiring retired intelligence employees and contracting them back to the agencies they had once worked for; their business boomed after 9/11, when the intelligence community found itself awash in money and desperate to catch up.

Today, the ties between intelligence agencies and the private sector are so close, it’s sometimes hard to tell the difference. Joan Dempsey, a former CIA deputy director, recently -- and approvingly -- referred to consulting firm Booz Allen as “the shadow intelligence community.” Three of Booz Allen’s current and former vice presidents previously served as intelligence agency directors, including James Woolsey, who headed the CIA during the Clinton administration. Connections with the private sector are especially close at the NSA, where outsourcing has grown rapidly. Former NSA director William Studeman is now a vice president of Northrop Grumman, and Barbara McNamara, a former deputy director, is on the board of CACI. After leaving government, these officials keep their high-level security clearances, which makes them extremely valuable to their new employers. “You can’t do anybusiness without having the clearances,” says John Pike of GlobalSecurity.org, a Virginia- based think tank. “How else would you know about the contracts?”

The lines separating contractors from agencies are so blurred that at the leading trade association -- the Security Affairs Support Association (SASA) -- 8 of 20 board members are current government officials. The association represents about 125 intelligence contractors, including Boeing, CACI, General Dynamics, and Computer Sciences Corporation (CSC). Retired Air Force Lt. General Kenneth Minihan, its president and chairman, is yet another former director of the NSA. As a nonprofit, SASA is barred from lobbying, but it frequently sponsors events where government and corporate officials mingle, and it provides infor- mation to members of Congress. “We use the term ‘advocacy,’” says Frank Blanco, SASA’s executive vice president.

Intelligence contractors themselves, meanwhile, have fielded armies of lobbyists to keep the money flowing; according to the Project on Government Oversight, Lockheed Martin spent $47 million on outside lobbying between 1997 and 2004, while another company, SAIC, spent $8.6 million and CSC spent $3.3 million. Lockheed Martin has also hired Joe Allbaugh, who managed the 2000 Bush campaign, to lobby for its rapidly growing intelligence division. And the companies are showering key members of Congress with contributions: The top contributor to Duncan Hunter (R-Ca.), chairman of the House Armed Services Committee, is Titan Corp. Over at the Senate Intelligence Committee, Chairman Pat Roberts (R-Kan.) received $14,000, almost half of his PAC intake in 2004, from six key contractors.

Most of the big players in the intelligence business have set up shop within shouting distance of SASA’s offices on the National Business Parkway in Annapolis Junction, Maryland -- just blocks from the gleaming headquarters of the NSA. One large building bears the logo of Boeing, the prime contractor for the nation’s spy satellite system; the next complex houses CSC and Logicon, the information technology unit of Northrop Grumman. Together, in 2001, the companies won a $2 billion contract to modernize the NSA’s information systems; the day the project began, more than 600 government workers were instantly transformed into private contractors. Next door sits the brand-new headquarters for Titan, whose earnings have surged due to its contract with the U.S. Army to supply translators and provide support for the military’s unmanned spy planes. Across the street is Booz Allen, one of the prime contractors for the Trailblazer project, a huge effort to overhaul the NSA’s top-secret signals intelligence capabilities. Booz Allen and SAIC are doing research for the project under a $280 million “technology demonstration platform” contract, and few doubt that the NSA will award the final, much larger contract to the same companies. That troubles analysts, who say that allowing contractors to write the specs for their own future deals -- as Halliburton did in Iraq -- is a conflict of interest. That task “should remain within the agencies,” says Aftergood. (Booz Allen, like other contractors contacted for this article, would not comment on its intelligence work.)

But with the contracting boom continuing unchecked, such controls are unlikely -- which means, says Pike of GlobalSecurity.org, that America’s spy network could soon resemble NASA’s mission control room in Houston. “Most people, when they see that room, think they’re looking at a bunch of NASA people,” Pike notes. “But it’s 90 percent contractors.”