Falling Down on the Job

Call it the Casablanca defense: "I am shocked, shocked, to find that gambling is going on here." That was the undercurrent of officialdom’s reactions to revelations about the — ahem! — shocking behavior going on among the private security guards protecting the U.S. Embassy in Kabul.

But faux horror is appropriate enough because nothing highlighted in the recent report by the watchdog organization Project on Government Oversight (POGO), should really come as a surprise. POGO’s 12-page letter, based on testimonials from more than a dozen disaffected guards and publicly addressed to U.S. Secretary of State Hillary Clinton, described the dysfunctional American core of the operation of some 450 guards, two-thirds of whom are Gurkhas. There was abusive hazing and collective degeneracy, as abundantly revealed by photos of guards cavorting around a huge bonfire in various stage of undress, drinking vodka off each other’s backsides, and regaling each other with public urination. Although far less sinister than the Abu Ghraib snaps, these new inconvenient images still conveyed something of the Lord of the Flies atmosphere that whistle-blowers say had curdled into a subculture of coercion and intimidation, undermining the chain of command and jeopardizing safety at one of the United States’ largest and most besieged embassies. How else to explain the fact that 90 percent of incumbent expats left the job in the first six months after embassy security was taken over by ArmorGroup?

Still, much of the reaction in Washington misses the real import of this episode. It’s certainly not about the hazing or the prostitution highlighted by the embassy’s former operations director. Nor should the press be focused on how many guards are being dismissed, when there are legions more happy to become replacements. The real problem is a global private security industry (increasingly publicly listed) that averts its eyes from the sordid details on the ground as long as its employees make the numbers, and the industry’s incestuous relationship with an undertrained, and still effectively unaccountable, contracting bureaucracy that likes to talk about "lessons learned" from Iraq, but is demonstrating just the opposite by its performance in Afghanistan.

The case also exposes the disturbing flaccidity of most U.S. inspectors general, who should be having career-boosting field days with all the waste, fraud, and abuses in Afghanistan, but are instead showing up late, with no evident sense for the jugular. Sadly, that’s particularly true of the special inspector general for Afghanistan reconstruction, who was chosen, according to my sources, precisely so as not to repeat the robust (i.e., administration-embarrassing) record of his counterpart in Iraq. Together these flaws are contributing significantly to the corrosion of the U.S. mission in Afghanistan.

One of the driving forces here is the corporate profit motive, and the money-grubbing tactics are well-laid out now in two civil complaints filed in the D.C. District Court by former senior company employees, the first in April 2008 (settled out of court) and the other last week. To win the coveted $187 million contract, ArmorGroup North America — effectively acting as a front for ArmorGroup International (AGI) in London (which is owned by Wackenhut Services, a subsidiary of British-Danish firm G4S, the world’s biggest security concern, with revenues last year of $9.85 billion) — seriously low-balled its bid. That compelled it to cut corners wherever it could: replacing Americans with cheaper South Africans, putting the Gurkhas on stingy wages, and buying refurbished cars from Iraq — staff called them "white coffins" — rather than the properly armored vehicles promised in the contract. A measure of the bare-knuckle scruples of this charming firm: AGI’s human resources director, Carol Ruart, insisted, allegedly, that the Gurkhas be locked in their rooms until they agreed to work for even less after they threatened a walkout over wages and shabby treatment.

Kabul managers were particularly concerned about the quality of recruits. Reports from pre-deployment training in Texas had already flagged objectionable behavior such as "lewd, aberrant, and sexually deviant behavior, including sexual hazing, urination on one another and equipment, bullying, ‘mooning,’ exposing themselves, excessive drinking," according to the later complaint. There were concerns some might be mentally imbalanced; one pulled a gun on another while drunk. Another ArmorGroup security guard, with a criminal record, allegedly shot and killed two fellow guards in Baghdad’s Green Zone recently.

Squaring this battered circle into a functioning contract fell to a 22-year Marine veteran from Massachusetts, James Sauer, who was hired in December 2006 as program manager to prepare for taking over embassy security in July 2007. But because the firm had, according to the complaints, already materially misled the State Department about its existing assets, fulfilling the contract and turning a profit at the same time was going to be difficult. Sauer repeatedly sought to persuade senior management that it needed to spend more money to do the job right or the company would suffer serious damage to its reputation. After being repeatedly rebuffed, Sauer, his deputy Peter Martino, and James Gordon, the operations director, formally reported their concerns to the embassy’s regional security officer, who duly reported it to Washington.

The next day, June 13, 2007, Sauer and Martino were fired, and then their erstwhile underlings stripped them of their weapons, cell phones, computers, and vehicles and confined them to the compound until they could be flown out of the country. Gordon was pressured to leave on the same flight. Shortly thereafter, a series of "rogue managers" apparently more willing to flout the terms of the State Department contract were hired. This included South African Nick Du Plessis in Sauer’s position, even though as a foreign national he was unable to obtain a U.S. security clearance, as the position required.

Most or all of this was known to State Department employees overseeing the contract. The first of eight "deficiency" or "show cause" letters was sent to the company in July 2007, the same month the company took over security from its predecessor. Sauer, Martino, and Gordon had been sending regular informal updates to the embassy’s regional security officer about their misgivings. The contracting officer’s complaint letters to the company continued, but somehow, each time, concerns were at least momentarily assuaged; the contract was renewed not once but twice, and is currently valid until July 2010. A Senate committee investigation stated, "The Kabul embassy contract can be viewed as a case study of how mismanagement and lack of oversight can result in poor performance."

But contractors are endemic to U.S. missions abroad. They make up roughly 50 percent of the force structure in Iraq and even more, as much as 70 percent, in Afghanistan. This heavy expeditionary underbelly comes after the U.S. government decimated its contracting management expertise as part of the post-Cold War downsizing. The Defense Contracting Management Agency slashed staff from 25,000 to 10,000, and when former Undersecretary of Defense Jacques Gansler headed a Pentagon commission studying this issue in 2007, only a third dealing with contracts had appropriate certification.

Now a public policy professor at the University of Maryland, Gansler says he is encouraged by the steps the Pentagon has taken to change its internal culture around contracting. (The State Department is generally regarded as far behind in this process.) This has been signaled most clearly by the establishment of the Army Contracting Command, which is to be headed by a three-star general with two one-star reports, he noted. But Gansler might be a bit too sanguine about its effect. Establishing a position where the buck is clearly supposed to stop does not itself ensure accountability.

Sen. Byron Dorgan made that abundantly clear the other day in an exquisite Senate floor excoriation of three-star Army Lt. Gen. William Mortensen, deputy commander of the Army Materiel Command, who awarded a $300 million contract to a fly-by-night company (AEY, Inc.) run by a 23-year-old CEO (with a 25-year-old massage therapist as vice president), which supplied the United States’ Afghan allies with old, Chinese-made ammunition. "He was completely unapologetic about this, by the way," said Dorgan when he met Mortensen, who has since retired. "He told me, under similar circumstances, the Army would probably make the same decision again and give contracts to such people again … [and that if the two defendants, who face fraud charges] were acquitted, the Army would go back to doing business with them."

Of course, enforcing accountability is the core of the mission of inspectors general, but that’s a story for another day. Suffice it to note that it was the press — the New York Times — that first exposed the AEY scandal.