Despite scandals over human rights abuses and war profiteering, private military contractors are expanding their presence overseas, and may even be involved in helping to draft the next U.S. defense budget.
Currently more than 20,000 privately contracted employees are at work in Iraq, feeding U.S. troops, providing security, and rebuilding the occupied nation's shattered infrastructure.
Although private military contractors, known as PMCs, were implicated in the torture scandal at Baghdad's Abu Ghraib prison, and are the target of congressional probes into over-billing, more than 150 U.S. companies have been awarded contracts worth up to 48.7 billion dollars for work in post-war Afghanistan and Iraq, according to research by the Washington-based Center for Public Integrity.
That figure represents an increase of 82 companies and more than 40 billion dollars since the Center first issued a study of contracts awarded to PMCs last fall.
In a separate report released Jul. 29, the Center also found that three private companies -- Booz Allen Hamilton, Perot Systems Government Services and Miltec Systems Co -- are headhunting for analysts to work in the development of the U.S. defense budget.
"The trend is rising and has been driven by many factors: the drive to privatize state services, the vast disparity between the pay PMCs get and those employed by the state -- PMCs earn perhaps five times as much -- leading to a real shortage within the armed forces of the U.S. and U.K," says William Bowles, a journalist who has written extensively on PMCs.
"It's (also) a method of hiding the real level of casualties," he added in an interview.
Some high-profile killings in Iraq have involved contractors, like Paul Johnson, the Lockheed Martin engineer beheaded by Islamic militants in June, and the four employees of Blackwater Security who were killed and dragged through the streets by a mob in Fallujah.
Lesser known are the more than 100 other contractors, including about 40 employees of controversial giant Halliburton, who have also lost their lives in Iraq since fighting officially ended more than one year ago.
Casualty numbers from the war itself are hard to come by, but Robert Fisk and Patrick Cockburn reported in South Africa's 'The Star' Apr. 16 that "at least 80 foreign mercenaries -- security guards recruited from the United States, Europe and South Africa and working for American companies -- have been killed in the past eight days in Iraq".
Independent experts say one of the main problems with PMCs is the lack of transparency in the bidding for their contracts, combined with scant oversight of how they spend the money.
Halliburton, the military services company with close ties to Vice President Dick Cheney, has been probed by Congress and the accounting firm KPMG for overcharging for some 167 million dollars worth of gasoline imports from Kuwait, as well as a variety of other abuses associated with its 5.6-billion-dollar troop support and military logistics (LOGCAP) contract.
Bechtel Corp, which won a 680-million-dollar deal to rebuild Iraq's water and sewage system, was one of only six firms to take part in a secretive bidding process. According to the Center for Responsive Politics in Washington, the company gave 1.3 million dollars in campaign contributions over the last three years, mostly to Republicans.
"Ironically, we set up a process to take advantage of the private market, but we're getting the worst of it," said Peter Singer, a scholar at the Brookings Institution who is an expert on military privatization.
"It's more about who you know, not who can do the best job for the best price," he said in an interview. "The oversight has been quite terrible, so we're not seeing any cost savings."
One of the most controversial tasks delegated to private contractors has been interrogation of Iraqi detainees. This week, victims of abuse at Abu Ghraib, including the widow of one detainee who died of torture, filed a lawsuit in U.S. federal court against two PMCs: CACI and Titan. Employees of the firms were allegedly present during the abuse of prisoners.
According to an Army Inspector General's report, more than one-third of the 31 interrogators provided by CACI lacked any "formal training in military interrogation policies and techniques." The company still has 19 interrogators working in Iraq.
CACI insists its workers were always subject to the military chain of command, and notes that it has been cleared of any wrongdoing and continues to hold government contracts. It has called the lawsuit "frivolous."
"CACI personnel were never in charge of military personnel in Iraq," the company said in a statement. "Civilian contractors do not give orders to military personnel."
But some experts say that focusing on the chain of command misses the more important issue.
"Most people, including many people in the military, find it stunning to turn over an integral, mission-critical role like interrogation in a military prison to a private contractor," said Singer.
The United States is not only reliant on private contractors for work overseas, but also at home. This year the government will spend 275 billion dollars -- more than 10 percent of the federal budget -- on contracts to carry out its daily business.
In his book 'The True Size of Government', Paul Light of the Brookings Institution estimates the federal budget funds a "shadow government" of nearly 12 million contractors, about one-half of them in defense That means contractors outnumber civil servants and military personnel by two to one.
And as the military has trouble finding young people to sign up during wartime, and some seasoned troops leave for far more lucrative jobs in the private sector, Pentagon officials expect the role of contractors to expand further.
Brian Hilferty, a spokesperson for Lt Gen Franklin L Hagenbeck, the Army's top personnel officer, told IPS that private contractors would also be used to recruit new soldiers.
As the use of contractors grows, so does the cost of U.S. occupation. Last week Congress approved an additional 25 billion dollars for wars in Iraq and Afghanistan and seven percent more for the rest of the Pentagon's programs, in a 417.5-billion-dollar defense bill.
In a victory for the Pentagon, legislators backed down on language requiring the military to reveal the private security contractors it hires for work in Iraq, Afghanistan and Guantanamo Bay (a prison for detainees in President George W Bush's "war on terrorism") in Cuba.