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<h2><b>The Top 100 Private Contractors in Iraq and
Afghanistan</b></h2><font size=3>
<a href="http://www.publicintegrity.org/WOWII/" eudora="autourl">
http://www.publicintegrity.org/WOWII/</a><br><br>
<br><br>
By Bill Buzenberg<br>
<br><br>
KBR, Inc., the global engineering and construction giant, won more than
$16 billion in U.S. government contracts for work in Iraq and Afghanistan
from 2004 to 2006—far more than any other company, according to a new
analysis by the Center for Public Integrity. In fact, the total dollar
value of contracts that went to
</font>
<a href="http://www.publicintegrity.org/WOWII/Database.aspx?act=contractor_details&duns=010810893&contractor_name=KBR%20Inc%20%28formerly%20known%20as%20Kellogg%20Brown%20and%20Root%29">
<font size=3 color="#0000FF">KBR</a></font><font size=3>—which used to be
known as Kellogg, Brown, and Root and until April 2007 was a subsidiary
of Halliburton—was nearly nine times greater than those awarded to
</font>
<a href="http://www.publicintegrity.org/WOWII/Database.aspx?act=contractor_details&duns=608461898&contractor_name=DynCorp%20International%20%28Veritas%20Capital%29">
<font size=3 color="#0000FF">DynCorp
International</a></font><font size=3>, a private security firm that is
No. 2 on the Center's list of the top 100 recipients of Iraq and
Afghanistan reconstruction funds.<br><br>
Another private security company,
</font>
<a href="http://www.publicintegrity.org/WOWII/Database.aspx?act=contractor_details&duns=012418161&contractor_name=Blackwater%20USA">
<font size=3 color="#0000FF">Blackwater USA</a></font><font size=3>,
whose employees recently killed as many as 17 Iraqi civilians in what the
Iraqi government alleges was an unprovoked attack, is 12th on the list of
companies and joint ventures, with $485 million in contracts. (On
November 14, the <i>New York Times</i> reported that FBI investigators
have concluded that 14 of the 17 shootings were unjustified and violated
deadly-force rules in effect for security contractors in Iraq, and that
Justice Department prosecutors are weighing whether to seek indictments.)
</font>
<a href="http://www.publicintegrity.org/WOWII/Database.aspx?act=contractor_details&duns=535150841&contractor_name=First%20Kuwaiti%20General%20Trading%20And%20Contracting%20Company%20Wll">
<font size=3 color="#0000FF">First Kuwaiti General Trading &
Contracting</a></font><font size=3>, which immediately precedes
Blackwater on the Top 100, came under fire in July after a pair of
whistleblowers told a House committee that the company essentially
"kidnapped" low-paid foreign laborers brought in to help build
the new U.S. embassy in Baghdad. First Kuwaiti and the U.S. State
Department denied the charges.<br><br>
Other key findings from the Center's analysis:<br><br>
<b>• </b>Over the three years studied, more than $20 billion in contracts
went to
</font>
<a href="http://www.publicintegrity.org/WOWII/Database.aspx?act=contractor_details&duns=123456787&contractor_name=Miscellaneous%20Foreign%20Contractors">
<font size=3 color="#0000FF">foreign companies</a></font><font size=3>
whose identities—at least so far—are impossible to determine.<br><br>
<b>• </b>Nearly a third of the companies and joint ventures on the Top
100 are based outside the United States. These foreign contractors, along
with the $20 billion in contracts awarded to the unidentified companies,
account for about 45 percent of all funds obligated to the Top
100.<br><br>
<b>• </b>U.S. government contracts for work in Iraq and Afghanistan have
grown more than 50 percent annually, from $11 billion in 2004 to almost
$17 billion in 2005 and more than $25 billion in 2006.<br><br>
According to David Walker, the comptroller general of the United States,
the outsourcing of government has escalated across the board over the
past five years, although oversight of the process has shrunk during this
same period. In an interview with the Center for Public Integrity, Walker
noted particular problems with military contracting. "We have
identified about 15 systemic, longstanding acquisition and contracting
problems that exist within the Defense Department—which is the single
biggest contractor within the U.S. government—that we are still not
making enough progress on," said Walker, who heads the Government
Accountability Office. "I mean, this stuff isn't rocket
science."<br><br>
While KBR earns the top spot among individual companies and their
subsidiaries, the firm's $16 billion in obligated contracts is eclipsed
by $20.4 billion in contracts that went to a nebulous collection of
companies identified by the U.S. government only as "foreign
contractors." The Center has filed a Freedom of Information request
for the 50 largest contracts—collectively worth some $19.6
billion—awarded to these unnamed companies. The largest of these
contracts is worth more than $6 billion—a sum that would catapult the
unidentified recipient to the No. 2 spot on the Top 100.<br><br>
In October 2003, when the Center published "Windfalls of War,"
Halliburton's Kellogg, Brown, and Root was also the top recipient of U.S.
government contracts for the postwar effort, with more than $2.3 billion
in awards over two years (see the story
</font><a href="http://www.publicintegrity.org/wow/report.aspx?aid=65">
<font size=3 color="#0000FF">here</a></font><font size=3>). By contrast,
Bechtel, the only other company on that 2003 roster to have received more
than $1 billion in awards, won a second large contract in January
2004—this one for $1.8 billion—but left Iraq after completing its work in
March 2007. Since this Top 100 represents contracts newly awarded in
fiscal years 2004 to 2006, Bechtel is not on the list.<br><br>
When the 2003 study was published, federal agencies did not
comprehensively distinguish war contracts in Iraq and Afghanistan from
other government contracts; therefore, Center researchers had to flush
out these contracts one by one. Since then, however, most such contracts
list Iraq or Afghanistan as their "place of performance,"
making the contracting process more transparent and the search for
data—available from the General Service Administration's Federal
Procurement Data System—more methodical.<br>
<a name="OLE_LINK2"></a><br>
But not all contracts for Iraq and Afghanistan are reported in this
federal data system, including awards originating at one contracting
agency in Baghdad, which reports only some aggregate totals for inclusion
in the central database. Because the agency has so far refused to furnish
these missing contracts, the Center is now seeking copies via Freedom of
Information Act requests.<br><br>
Officials in the Baghdad office say that these contracts are unlikely to
change the rankings of the largest contractors on the Top 100, although
some companies at the bottom of the list may change. According to Major
General Darryl A. Scott, the commander of the Baghdad contracting office,
these contracts are inaccessible not through willful omission, but
because of the computer resources and human labor that would be required
to integrate them into the main federal procurement database.<br><br>
Iraq remains the clear priority of the U.S. government, the Center's
research shows, with more than seven times as many contracting dollars
designated for spending there as for Afghanistan. Furthermore,
minority-owned businesses received less than one-tenth of 1 percent of
the total awards as primary contractors. (The GSA's data does not provide
subcontracting information.) And the data reveals that 12 of the 32
foreign contractors on the Top 100 are based in Turkey—far more than any
other nation.<br><br>
In the early months of the Iraq war, U.S. government officials were
criticized for awarding contracts there without competition. Since then,
however, much of the criticism has centered on cost-plus contracts, which
guarantee that a vendor will earn either a fixed amount of profit or a
set percentage of profit above its cost.<br><br>
Of the $13 billion awarded through cost-plus contracts in Iraq and
Afghanistan for 2004 to 2006, 30 percent was awarded through simple
cost-plus, fixed-fee arrangements that offer no incentives for
performance or cost savings. The largest amount awarded to one vendor
through cost-plus contracts, more than $8 billion, went to KBR. Much of
that was the result of a contract to provide logistical support for U.S.
Army combat operations.<br>
<br><br>
<i>Senior Database Fellow John Perry provided data analysis for this
story</i>.<br>
<br><br>
<br><br>
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