Hearing of the House Committee on Oversight and Government Reform - Blackwater USA; Private Security Contracting in Iraq & Afghanistan

Interview

Hearing of the House Committee on Oversight and Government Reform - Blackwater USA; Private Security Contracting in Iraq & Afghanistan

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DEL. ELEANOR HOLMES NORTON (D-DC): Thank you, Mr. Chairman.

Mr. Prince, I want to be clear that however you serve your country -- whether as a member of the armed forces or now as a contractor in time of war -- the people of the -- the American people are indebted to you. We understand that the risk is the same.

I want to avoid confusing the high purpose of the volunteer army with what some nations -- how some nations, candidly, operate. However you define mercenary armies, some nations have long used mercenary soldiers to deal in foreign countries with unpleasant tasks. The more dependent we become on contractors, the more we risk falling right off the cliff into a mercenary army that's nothing that you would have responsibility for, but it must be said: People fight wars that -- countries fight wars whether people support them. The people support them by being willing to provide the troops to fight those wars. That's the risk we have.

I want to ask you a question or two about your contract with the State Department. Under this contract, you employ security personnel as independent contractors rather than as your own director employees. Isn't that right?

MR. PRINCE: Yes, ma'am.

REP. NORTON: You don't have to provide employee benefits such as health or disability insurance, vacation, retirement and the like, as a result.

MR. PRINCE: Each of the individuals that deploys for us has a very robust insurance package that is with them every day they're working for us.

REP. NORTON: You also can avoid making Social Security contributions or withholding taxes. Is that not true?

MR. PRINCE: I'm not sure on that.

REP. NORTON: I believe that is true, sir.

By contrast, DynCorp and Triple Canopy and other security firms that support the State Department treat their employees -- their personnel as employees entitled to these benefits. Why do you treat your personnel differently from these two companies?

MR. PRINCE: I don't know the differences in how they compensate their people. I will tell you we have the highest retention in the industry. We have guys that sign up for us at a very, very high rate. So we don't get losses. The men seem to -- the men and women seem to feel very well treated by us.

DEL. NORTON: Well, of course, one of the differences is in the employee benefit package I've just named.

Does Blackwater hire personnel as independent contractors in order to avoid legal responsibility for the company?

MR. PRINCE: No, it's actually really what the men that deploy for us prefer. We find it's the model that works.

DEL. NORTON: Well, Mr. Chairman, it may, in fact --

MR. PRINCE: They like the flexibility of signing on for a certain period of time and being able to schedule their off-time around an anniversary, a child's birthday, being home for Christmas, et cetera. So it gives them flexibility as to when they're going to deploy, when they're going to go to work, just like a professional man.

DEL. NORTON: Does it really give them more flexibility than the other two companies who have them as employees? Those people don't have the same kind of flexibility? Or what kind of flexibility can you have if you need your employees at a time of engagement, for example?

MR. PRINCE: I don't know, ma'am.

DEL. NORTON: Well, I think the fact is, when you need them, you need them. You don't say you can go home for Christmas, sir.

Mr. Chairman, I think we should -- I'm very disturbed by this confusion, which amounts to legal confusion, about the responsibilities of contractors. I will give -- concede the notion that employees can choose whether they want to work for a company that, in fact, requires them to pay for their own benefits or not. My confusion --

MR. PRINCE: Ma'am, let me just add, we have a (Unicaid ?) program that allows them -- it's like an individual 401(k) plan. So they are able to, while working for us, able to have a 401(k)-like program.

DEL. NORTON: Yeah, I understand that. Probably the other employees -- excuse me -- companies that I've mentioned probably also have 401(k) programs. And again, my major concern is not what private employees decide to do.

Mr. Chairman, my concern is that these Blackwater contractors, so far as I can see, operate under the direct command or supervised by Mr. Prince and his company. They operate under the law of the United States in some fashion. And it is simply unclear, after a full day's hearing, whether these employees -- whether this company is subject to law in the way that the American people expect anybody in a field of combat to, in fact, be subject to the law of someplace.

I believe we need an investigation, Mr. Chairman, by the GAO to clarify what law, if any, such companies and their employees, whether contract employees or not, should answer to.

REP. WAXMAN: The gentlelady's time has expired.

MR. PRINCE: If I could just answer, ma'am, I think the FBI investigation regarding the September 16 incident proves the measure that accountability is in place, that that process is working. And as for their working for us when they're overseas, we provide the trained person with the right equipment, the right training, the logistics to get them in and out of theater.

When they get to Iraq or they get to Afghanistan, they work for the State Department. We work under that RSO's operational control. They're not under our operational control.

REP. WAXMAN: Thank you, Ms. Norton.

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