...the Prince will doom thee death

(From Hope & Onions)

Tuesday, October 2, 2007: Congressman Harry Waxman, the tireless Chairman of the US House Oversight and Government Reform Committee, presided over 3+ hours of testimony, provided by Blackwater USA CEO Erik Prince. The following is a rough-transcript only:

-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
[Waxman's written report to his cmte about Blackwater, Oct 1, 2007]
[Prince's written statement to the Committee]

10:24 AM
Waxman is delivering his opening stmt now, including a (clearly grudging) nod to Blackwater CEO Erik Prince's Naval service, despite his wealthy and privileged upbringing. I would add: his family is very connected to Bush, Republican money and, through his wife, Amway.

Waxman reminds cmte of the Blackwater guard, Xmas 2006, who got drunk and shot an Iraqi guard in the Greenzone. The guard died, and yet the Blackwater employee was only fired. No criminal consequences. The State Dept recommended a bribe--paying off the Iraqis, even accusing them of extorting Blackwater, writing that "Iraqis are trying to get themselves killed" for money (Grr!)

The FBI has launched a crim. investigation against Blackwater, for the Sept 2007 shooting of civilians in Nisoor Square. Justice dept has asked Cmte *not* to hold hearings, given FBI's investigation. Waxman is going ahead anyway.

Waxman asking Prince only about earlier Blackwater crimes, not Nisoor Sq, b/c of FBI investigation.

10:28 AM
Ranking Republican Tom Davis is making his opening stmt. He cautions against focusing on 'any one company,' and hopes there will be additional hearings about security firms in Iraq.

Davis making case that private firms add 'surge capacity' to US presence. Concedes that presence of private soldiers with guns breed resentment among Iraqis. (Gee, ya think?)

References editorial in WaPo: "foolish" to get rid of private security in Iraq. ACK!

10:44 AM
Davis is still reading WaPo editorial, including their recommendation that security firms remain in Iraq to protect State dept, but that they not linger to secure the scene, following altercations. Jeebus.

John Tierney (D-MA): does it make sense to keep using private firms? Should the US go to war if it can't send enough personnel of its own to handle everything? We don't know the #dead private personnel...reports indicate 9 dead, but they aren't included in casualty figures. Have too few managers to oversee corporate personnel.

Patrick McHenry (R-NC): "Irresponsible" to hold this hearing, before Exec branch has completed its own investigation (FBI/DoJ). McHenry is grateful that no member of congress has been harmed while under Blackwater protection in Iraq. (Oh Bravo...RollingMahEyes) Wants cmte to be patient for DoJ/FBI result, and for the cmte to focus on broader issue of role of contractors in war. Don't follow "front page" stories...contracting is "the liberal cause du jour" (Grrr!)

Carolyn Maloney (D-NY): Privatizing the military--Blackwater guards make 6 X more than actual military. Believes Blackwater has been 'aggressive' and 'reckless.' We were told that this was supposed to save guv money (pardon me... ROTFL!)

Dan Burton (R-Indiana): 3073 missions in last 9 months by private contractors, 77 involving weapons use. There have been 54 000 reported attacks, 6000/month; 42 killed contractors since 2002. "Important to have these hearings, but there should not be a rush to judgement."
"Not one congressman...has been killed" while under Blackwater protection in Iraq.

Elijah Cummings (D-Maryland): "shadow army of mercenary forces...not accountable to anyone else"...involved in 195 firing exchanges, most of which Blackwater was found to have fired first.

Darrell Issa (D-CA): feels hearing is a repeat of the "Moveon.org attack and Gen Petraeus' patriotism"..."what they couldn't do to their men and women in uniform, they'll do to" private security firms. (#%@%!&*%!)
"I'm here to defend Gen Petraeus and the men and women in uniform." "We do not want the military guarding the State dept personnel"..."do we really want 1500 special ops people guarding State dept..."

Denis Kucinich (D-OH): Over 1 mill Iraqi citizens have died in this war. At least 2 mill households have lost a family member. Lancet conservative est of 655 000 deaths (over a year ago). Concerned that State dept has attempted to coverup Blackwater killings of civilians.

10:48 AM
Kucinich: How much more do we need to know that...this war has been a disaster for the Iraqi people?

John Mica (R-FL): Dem majority is trying "to discredit the President," quoting Waxman, and remarks about Bush, State dept, Iraqi govt. "Now we're down to...discrediting contractors" "48% drop in deaths in one month" in Iraq--claims "bad news for the [Dems]." (Le Barf!) "I don't know what happened on the 16th or in other incidents...but the letter from DoJ...we are interfering with a DoJ and STate dept investigation. "Move that the cmte now adjourn"

Waxman holds vote: the Nos have it, motion defeated.

Waxman: swears in Erik Prince, CEO Blackwater. (he's doin it, too! Shocked applause )

Jeez...Prince looks much younger than I expected.

10:54 AM
Waxman cautions Prince not to divulge details re: Sept 16th Nisoor Sq shooting, and limit to earlier instances.

Prince giving opening stmt: glurge about military and committed veterans, wanting to serve again in some other capacity. Trains 500 mems every day. After 911, US gov recruited Blackwater and insists all personnel are all ex-military or ex-law enforcement. Says 30 men have died. Personnel are attacked by 'ruthless enemies'...allows more US servicemembers available to be freed up for combat etc.

Prince: contract "competitively awarded," and subject to standards, including "Rules of Force" standards. Claims there are procedures to ensure compliance with "applicable laws and regulations." "Does not engage in offensive missions." "Welcome FBI review announced yesterday" (about Sept 16 Nisoor).

Prince: dept State report, "1083 security details" conducted for dept, and only 56 incidents with gun discharge, or 3% missions. Uses phrase "only 56" incidents (Blechh...)

11:01 AM
Waxman to Prince: you are making > 1 bill dollars/yr. We are paying you for work ordinarily done by US military--are we paying more and getting less? On Nov 27, 2004, there was a plane run by BW aviation that crashed into a mountain in Afghanistan, carrying 3 active duty military personnel...about 40 min after takeoff, BW 61 crashed into wall, crash was investigated by joint Army/Navy taskforce; the NTSB too; claimed BW behaved "unprofessionally" and flew too low, the pilots deviated from route, flew too low. Transcript of cockpit: BW overheard "we're a Starwars man" "You're f'g right" "They'd be [?] if they knew how fun this was."

Waxman: did BW's pilot act responsible or, as the Army investigator said, "acting like cowboys?"

BW/Prince: I disagree. Anytime you have an accident, it's an accident...there's no flight route, no nav-aids, it's truly Alaskan style bush flying.

Waxman: but BW violated its own policy, assigning unexperience pilots; neither had flown for that long or for that route used that day. BW said "I hope I'm flying into the right valley" Flight mechanic observed: "We don't normally go this route..." and tried to help. Response?

BW/Prince: Military violated its own policy by loading ammo onto flight, not supposed to mix ammo, cargo and military personnel.

Waxman: but BW failed to follow std precautions, failed to maintain ER communications. Cost the life of crash's sole survivor. Nobody knew where that plane had landed.

Waxman: email 16 days before the crash, from P Hooper BW: "BW knowingly hired pilots with no background"..."pilots did not meet the criteria"

11:05 AM
Waxman: email from widow of one military person in the crash--she says that her husband was better trained as a pilot than the BW hired to fly the plane he was in Sad

Prince: We do small missions only. We fill that gap. The trips are too small for US military to accomplish with their big planes.

Waxman: what? Why wouldn't we just get our own "small" planes, instead of hiring you? We've been in Iraq 5 yrs. Was there any corporate accountability for this accident?

Prince: introspection. Air Force: it was pilot error, not corporate error.

Waxman: but the corpse hired inexperienced pilot. BW was the corporation involved. Aside from introspection, you just got awarded another 192 mill contract. I want to check if there are any sticks with all these carrots.

11:17 AM
Yuck!!! Issa wants to know if Waxman bothered to investigate a plane crash that happened under Clinton (missed the name).

Waxman says a report was filed and is totally available to Issa. Jeebus.

Prince: we don't even record all the times we take fire. An "incident" by defn is a defensive fire. BW records those.

McHenry: these 56 incidents pretty much involve *returning* fire, either from gunfire or "potential" bombs/explosives

Prince: Yes...every time they leave the wire, they are briefed, etc...and the use of force continuum in the Rules of Engagement

McHenry: dept State's RoE? similar to DoD RoE?

Prince: hesitating...uh..yes, the DoD rules for contractors (concedes not same as actual US soldiers.

McHenry: how many of your BW have been injured/killed under *your* care?

Prince: Zero.

McHenry: that is the operable number here. Your client is the State dept. to provide a protective service...and you've had zero ind'ls in your care and protection...that should be a testament to those former veterans working for BW.

Ranking mem Davis (R-Virginia): how are you paid for security details

Prince: on a per man day.

Davis: Cost plus?

Prince: mostly fixed price.

Davis: do you work for DoD as well as State

Prince: some in consulting position at DoD but nothing significant.

Davis: does State Dept provide sufficient guidance for BW personnel in Iraq, e.g. use of force

Prince: yes sir. State Dept are the "GE like buyers" with the "highest standards" (RollingMahEyes)

Davis: whom do you report to if a shooting incident occurs? What happens to dismissed employees?

Prince: we fire them, can fine them, but we can't do anything else. We present that incident to RSO. Fired 122 employees in Iraq. Send termination notice to State dept.

C. Maloney (D-NY): asking about fired employee, one who got drunk on Xmas eve, 2006, and shot/killed Iraqi guard for Iraqi VP in Green Zone. Wants to know about his firing. He was fired for "handling a weapon and being intoxicated"

Prince: our rule is 8h between EtOH and weapon handling.

Maloney: Justice dept still investigating this shooting. Have any charges been laid in the Mil Justice system?

Prince: I dunno.

Maloney: other than firing him, has there been any other sanction him. Has he been fined for killing? How much?

Prince: multiple thousands of dollars. Dunno exactly. Not apologizing for 'what he did.'

11:23 AM
Maloney: BW arranged for this drunk guard 2 days after the shooting. Did BW try to arrange for the guard to leave the country?

Prince: we fired him.

Maloney: if you commit a crime, shouldn't you have investigated thoroughly? Inside the Green Zone, especially, where you could have done forensic etc? Why pack him up and help him leave the country straight away? Any investigation would have only just begun 2 days post-killing.

Prince: we as a private co can't detain him. He was fired. Says Air Force arrested the employee.

Maloney: it's been 10 months and nothing has happened to this employee. He would have been court-martialled immediately if he were a mem of the military. Concerned about how BW's actions may be hurting "trust" btwn Iraqi people and military. No kidding.

Burton (Repub): what are RoE? I understand there's a warning to not get w/in a 100 m of your vehicle (in both English and Arabic). If a vehicle gets too close, what actions are taken?

Prince: air-horn first; hand signals. Audible yelling of 'Stop' in Arabic. A bottle rocket to signal--a bright incendiary device (non lethal) warning; water bottles are sometimes thrown to warn off driver; shoot into radiator; next stop, put a round into centre of windshield "away from the occupant," and *then* you shoot at driver. "long" continuum before get to killing in RoE.

11:29 AM
Burton (Republican): Burton: you R former Navy Seal. ... Your employees are facing tremendous danger in these settings. Why wouldn't you take some precautions?

Prince: some think killing Americans is "Big Media" (huh?)

Burton: what would happen if BW remained whilst under attack?

Prince: our job is to get them "off the X"..."get them into a safe place"..."can't stay at a crime scene/terrorist" scene while dignitaries etc in our care. Defensive fire, sufficient force to extricate ourselves from the situation. We want to "get our package" out of harm's way.

Cummings (D-MD): is BW helping our military or hurting them. Concerned 'ordinary Iraqi' can't discriminate btwn BW and US mil personnel. Still worried about shooting of Iraqi VP's guard by BW. Original reports made mistakes in the media, reporting incorrectly that a US *military* officer shot and killed an Iraqi guard. Were you aware?

Prince: no

Cummings: did BW take any efforts to correct or inform the press?

Prince: not allowed, by contract to speak to the press.

Cummings: BW sent an email internally, in which he said "at least the ID of the shooter will take the heat off of us", ie BW
Mr. Prince, did anyone in your org. raise any concerns that raising a false story might lead to retaliation against our troops? We are trying to be supportive to Iraqi guv...when these stories are put out, the Iraqi people feel US is not supporting guv.

11:42 AM
Prince: we do not have the power to enforce US law (re: drunk guard)

Waxman: fine? how much?

Prince: don't know. Withheld salary, place ticket etc.

(republican) Mica: you said killing Americans was "Big Media"...did you have any idea it would be "this Big a Media?" I don't know if there were criminal acts...one ofthose would be at DoJ. Wouldn't that be normal procedure?

Prince: yes sir. There are thousands of people in the field.

Mica: should look at Comair crash in KY, etc, let alone incident with basically with no controlling of air space of Afghanistan. The pilot was not found? (from BW plane crash). If we have an experienced pilot, Steve Fawcett, we haven't found him yet...just want to put this in perspective.

Prince: yes sir, it's just like Nevada. (huH?!)

Mica: they claim you're being paid too much...

Prince: privatization means accountability (BOOOO!!) We can be brought up on charges abroad or in the US. And then there's cost. Any manufacturer in US has to deal with that "make vs buy" analysis. What do some of these basic gov functions actually cost? The soldier over there doesn't show up there naked...that all drives cost. Delivering product or service at a competitive price.

Kucinich: privatization engenders interest in maintaining the war, keeping it going. Prince, your corpse has undergone staggering growth. In 2000, only about thousands in contracts; now in billions, beginning with Iraq war. From 2004 onwards, the amount of contracts went through roof $48 mill to over $500 million last year. One of your 1st contract was for CPA and Bremer, to protect dignitaries/officials, end of 2003.

Prince: yes, right after bombing of UN in 2003.

Kucinich: no bid contract, right?

Prince: off GSA schedule. Considered a "bid" contract, like buying from a Sear's catalogue Shocked

Kucinich: did anyone in BW talk to STate, Whitehouse, Devos (sp) family about the contract? As a taxpayer, is it NB to know that other corpses were allowed to bid?

Prince: not aware...

Kucinich: 2004 contract? You didn't have to compete for that one, either?

Prince: continued off GSA schedule.

Kucinich: with whom did you deal with?

Prince: don't know.

Kucinich: SIGIR reported that it was no-bid. Was SIGIR incorrect?

Prince: not sure how they define nobid/bid. off GSA considered bid, AFAIK.

**[BREAK to cover skdadl in the prosecutor purge thread BRB]**

12:24 PM
Tierney (D-MA): in report, former CPA advisor said private mission diff from military; not worried about Iraqis. Colonel said, "BW maybe working w/in contract, but it is to the detriment of our mission"; firing on cars, driving Iraqis off road, might be working against US missions. "They shoot people and then someone else has to deal with the aftermath." "...making enemies each time they went out...hurting our counterinsurgency effort."---quotes from military. Adm Fallon: "my instinct is, it's easier if they were in a uniform and working for me"

Prince: most companies are DoD-regulated. (BW isn't) Of the 16 000 missions, only 195 have resulted in discharge of weapon, only 3%. We don't get to choose when a bad guy fires on us...

Tierney: not always defensive though, you would acknowledge...

Prince: yes, but...serious ambush, killed 4 americans...blah blah blah...

Tierney: but you might fire first, ask questions later

Prince: USAF has DIRPA, we don't, we have BW use of force continuum, hand signals, flares, radiator, before we even go through lethal force option.

Tierney: you don't deny they shoot first, and the number of Iraqis implicated, the number that tell *other* Iraqis about bad behaviour...works against counterinsurgency effort.

Duncan (R-TN): using BW instead of troops is expensive. Putting it lightly. BW charges >1200$/day for one guard/day. This war has produced some of the most exorbitantly profitable contracts in the history of the war. Fiscal conservatives should be under no obligation to defend this kind of (expense). I notice it's gone from $25, 48, ...mill...>500 mill in 2006 (check later). Notice that Prince Group Holdings include a contract with Presidential Airways, under USAF command---what %PGH come from fed contracts of any type?

Prince: most PGH holdings come from fed contracts. Rough guess? 90%

Duncan: still have contract w/Pres Airways?

Prince: yes. For 8 aircraft right now.

Duncan: other companies in PGH?

Prince: manufacturing companies, pieces and parts for autos, etc. Long list of companies.
Charges to military: competitive prices charged for BW security. The report Duncan cited "is not accurate." Our profit is 10.4%, nothing higher. We have 3 helics shot down this year, and when they go down, comes "out of our hide," so we take risks for State Dept or Medevac, trying to pull US soldier out of situation, at great personal peril. Not just about the money. We're a business...happy to have discussion...what would it cost diplo security service in-house, on staff. If gov doesn't want us...

Clay (Dem): you say cost-effective, Mr. Prince, since gov can afford training salaries and benefits; yet BW personnel are all veterans and ex-law enforcement; some *recent* gov service. Doesn't that mean they've received years of specialized training at expense of guv?

Prince: that's a choice they make. Taxpayers are paying for that training anyway...we reorganize training to repackage and fill needs...to stand up 3000 mil police brigade, for every person deployed, have one or two STateside...just reorganizing skills.

Clay: Sec Gates concerned that contractors "poaching" military ranks, luring away w/much higher salaries. When Gates testified, said he asked Pentagon to draft "non-compete" clauses to discourage luring away. How do you feel about clauses?

Prince: fine, but every person who joins mil doesn't necessarily stay 20 yrs. After 4, 6 or 8 yrs, it would be upsetting for these ex-soldiers to go work in private sector, w/o using their skills. GAO study found special ops going to MBA school, but some come to work for us, but not at a higher rate than before.

Clay: but Secretary Gates really concerned about 'poaching.' Also: this Congress knows that some in Admin steeped in hypocrisy, taking frequent flies to Green Zone, some of the same one who have never lifted a rifle to defend US In Vietnam, but still accusing some of us of never going to Baghdad. (*snerk*!)

12:36 PM
Rep Michael Turner (R-OH): offended that Waxman claimed most wealthy kids no longer serve on military. Says it's an attack on members of US Congress like Duncan Hunter. (RollingMahEyes) Says a report claims mean educational level is above that of avg US citizen. Force is older and better educated. (says nothing about mean income though...*cough*)

Turner (R-OH) to Prince: you are free from some acquisition rules of military. Can you give us some insight into how our mil acq rules limit?

Prince: requirements process of military overspecs electronic capability...too much stuff put on mil vehicle to do job; can find most stuff on vehicles "off shelf" w/o needing all "bells & whistles" that military insists on vehicle.

Diane Watson (D-CA) : wants an apology for slagging Hollywood. She reps that area of Cali. Ok, ok...so silly.
Seriously, when I hear R. Limbaugh refer to "phony soldiers," I am offended too. I thought ad against Petraeus (moveon.org) should be taken down, too.
Watson asking Prince about Scahill's incredible Book ("rise of the World's most powerful army"); does Prince feel that we oughta continue to privatize the duties our military should be trained to execute?

Prince: US mil finest, blah blah blah...designed for large scale conventional operations.

Watson (interrupting): you're providing a service. And those jobs oughta be filled by volunteers, but why shouldn't they be compensated so that their families don't go on welfare, and in poor housing. Infuriated that State Dept and DoD don't "have the money" but war is >1 trillion and BW has been paid billions...do we continue to privatize b/c we're not training to do what you do. Should we pay *you* to train US mil to guard the way BW does?

Prince: we do a sig amt of training of US mil.

Watson: you say you fill a specialty gap...why not train more US mil? Why bring private firm and pay 3-4x more?

Prince: US mil can't be all things to all people all of the time. Too broad a base of skill requirement.

12:49 PM
Issa (R-CA): if State dept recruited for positions you're supplying, they'd be looking for the same pool as BW, i.e. ex military etc. Outside of AFghanistan and Iraq, do you know of anywhere else State dept uses helicopters?

Prince: in drug eradication in Colombia, for e.g.

Issa: so it's rather rare for State dept to require helicopters etc. This hearing is about cost-effectiveness of contractors. Would be nice to spend money on training military than contractors...?

Prince: don't know. Congress should study it.

Issa: I don't want to use contractors if fed employees more appropriate. If you feel a little pressure, thank God you don't make a diabetes drug...

Prince: excuse me?

Issa: compared the jury-rigged testimony we had for that drug...you're getting off easy...

Issa; is your sister a Pioneer for Pres Bush? Head of Michigan Repubs?

Prince: yes (Betsy Devos, sp??)

Issa: your family is easily ID'd as Repub leaning company? Including AMway family?

Prince: (hesitating) BW is non-partisan company. We do what's asked.

Issa: yes, you're doing what all companies do. Labelling a company based on its family members is inappropriate. [****NOTE: Issa is a nasty piece of work! Earlier that morning, Issa threatened Waxman on C-Span's Washington Journal****]

Yarmouth (D-KY): Outside of a military setting, where could a Navy Seal make money outside of govt contractors?

Prince: they don't make as much as you say. Avg pay ~$500/day, not $1000/day. Misperception, error in media. ~$90 000/yr.

Yarmouth (D-KY): That's not the cost to the taxpayer though...

Prince: but they're not showing up naked...need food, equipment, etc that we place competitive price models to acquire...a comp bid "product."

Yarmouth (D-KY): invoice to State dept: 3450 units each/2100.22$ each. E.g. Fallujah incident, you were a SUB contractor; in that congressional testimony, they had been contracted $600/day but, by time it got to taxpayer, over $1100/day. You were a sub contractor to KBR, Halliburton. Where did $500 overage go? Did Halliburton add any value to your $600/day person? Did profit just get spread to the three corpses? I realize that was a DoD contract; you were guarding conveys of Halliburton employees.

Prince: we work directly for State. no other intermediaries adding cost or value.

Yarmouth (D-KY): you are making taxpayers bid against themselves; they've already paid for training of Navy Seals, then they go and pay again for BW-employed Navy Seal.

1:00 PM
Westmoreland (R-GA): who's calling who a Republican company? Reads from letter to Pelosi, asking for investigation into "Republican" companies. Claims politics involved in hauling Prince before Congress. "There is a party in control of congress that thinks companies should not earn a profit"..."Do not understand someone who's an entrepreneur...want to fight a war w/o casualties...want to socialize medicine...have crony lawyers holding lawsuits against people like you...want govt distribution of wealth...love to have cake and eat it too...think Iraqi gov corrupt but yet they question your decision to remove an employee from Iraq after shooting...9/22 members voted that they agreed with moveon.org's attack on Petraeus." (*#&%(*&@!)
Question? Have you ever fired one of your employees for doing a good job?

Prince: uh...no.

Westmoreland: what kind of prof backgrounds do your superior personnel have?

Prince: 5-8 yrs to ~30 yr veterans of military or law-enforcement. "We affiliate with America...Americans working for America..." not mercenaries, b/c not working for foreign govt. Admits there are some foreign personnel, but not high-ranking.

Braley (D-Iowa): you say in stmt that you are under US laws regulations. Is it your test that all BW employees are sub to UCMJ or War Crimes Act?

Prince: Yes.

Braley: UCMJ applies in time of declared war. But no declared wars in Af or Iraq. A 'contingency operation' applies to these occupations, yes?

Prince: yes.

Braley: If UCMJ, then there are times that BW aren't serving armed forces or accompanying them in field, right?

Prince: IANAL. Our guys could be brought under investigation w/ruling legal authorities.

Braley: Mil Extraterritorial jurisdiction Act: there are circs when your employees wouldn't meet this std either, right?

Prince: this was changed to exclude us-funded contracts from statute.

Braley: War crimes Act 1996: you would agree when some employees wouldn't meet def of perpetrator, covered by WCA? e.g. Third country nationals hired by BW? Not members of US armed forces?

Prince: uh..

Braley: $15 000 payment to guard's family, one shot by drunk BW employee last Xmas. Aware of payment?

Prince: yes. But $20 000, not $15 000.

Braley: BW charges 1022$/day for each guard, right?

Prince: it's lower than that.

Braley: somebody your age in this country has life expectancy of 40 yrs. Calculating total lifetime earnings 17 million $$---that pales to a comparison to $15-20 000.

Prince: uh....don't make sense, b/c $1022 charge includes charge for helicopters, gear, training, travel. Will answer in written questions.

1:07 PM
Prince: we do crim background check on employees. 164 hrs training at BW, driving, firearms, defensive tactics, psych evaluation, phys eval.

McHenry (R-NC): when was BW formed? When did you get first guv contract?

Prince: 1997. First big contract competively earned was after Kohl blown up, 2001.

McHenry: how many competitors with Iraq contract?

Prince: 2 others.

McHenry: how awarded?

Prince: competitively; checked resumes of each personnel, inspection of instructors, audit on an almost weekly basis.

McHenry: ~1000 contractors for BW in Iraq. How much admin staff associated w/1000?

Prince: less than 50 people.

McHenry: active duty, what's the comparison? (military)

Prince: 8 admin/outside: 1 person in the field (military)

McHenry: therefore ind'l contractor much more efficient than military--"tooth:tail" ratio far better than US forces. Rolling Eyes
Could you explain the expense of overall operations? Is it far cheaper for BW (for taxpayer) contractor than for active duty military?

Prince: yes.

Waxman: do you have some kind of document you can provide to backup your statement, please give it to us.

1:23 PM
Betty McCollum (D-Minnesota): can dept State bring charges against contractors? Contractors have immunity from Iraqi law, based on CPA law brought in under Bremer, right?

Prince: yes.

McCollum: can't charge ind'l with crime, right? e.g. guard shot while BW off-duty?

Prince: believe US law should be enforced, but back in America?

McCollum: so CPA order 17 should stand?

Prince: would not get a fair trial in Iraq right now. Should be tried here in US.

McCollum: is dept State accountable under UCMJ?

Prince: don't know.

McCollum: you told Braley that all employees are under this chart...

Prince: for DoJ to decide.

McCollum: so this is just what you "feel" people should be accountable...

Prince: legal opinions I respect have told me...

McCollum: feeling or opinion...can't state for a *fact* that your employees can be held accountable under UCMJ?

Prince: for DoJ to decide.

McCollum: are you mil or civilian capacity?

Prince: civilian.

McCollum: you're saying civilians can be held accountable under UCMJ, in your opinion? To your knowledge, have there been any courts that have been accused of crimes committed in Iraq?

Prince: one related to CIA, North Carolina trial

??? Repub Rep: How many BW employees?

Prince: 1000 BW in Iraq, 550 Stateside, couple hundred in Afghanistan and a bunch in "little pockets" around the world.

??? Repub Rep: How many contracts w/fed gov

Prince: ~50

Issa (R-CA): are you aware of media reports about your family, donations, Michigan GOP? Have you ever seen a bio about your life about everything to do w/your sister etc?

Prince: it's not often our bios are printed together (w/sister)

Issa: opensecrets.org stuff---is this germane to today or is it just an attempt to "paint you as a Republican supporter"? I heard that a family member of yours even gave money to the Green party. Far left and right. I would move to remove pg 5 of your bio to be removed.

Davis: to clarify, your first fed contract was with Clinton admin in 1998, w/Navy Seals?

Prince: Right.

Cooper (D-TN): training of foreign govts?

Prince: all licensed back through State dept.

Cooper (D-TN): what if Putin offered a lot of money? You're assuming a state dept license applies?

Prince: we have to have license to train...

Cooper: no, what's to prevent you from working for foreign govt?

Prince: won't switch allegiance to foreign govts

Cooper: why not put that in your charter or bylaws that employees only work for USA?

Prince: but we have NATO allies in Afghanistan that need training (***REMEMBER: Canada uses BW to train!*****)

Prince: State dept controls licensing of training for foreigners

Cooper: it says you were hired to train Azerbaijan Navy commandos?

Prince: paid for by US gov by regional engagement policy. I don't make this policy.

Cooper: why would it be harmful to forbid employees from working from foreign govts?

Prince: can't do that.

Cooper: what if foreign govt hires you to "break a strike"...is this allowed? Permissable?

Prince: not something we're looking at.

Cooper: but it's allowed.

Prince: I have 5 boys I'm raising, maybe one of them will take this over one day...(WTF??)

1:34 PM
Hodes (D-NH): you were asked about drunk BW employee who shot guard in Xmas 2006. He was fined, but you don't remember the fine. BW provided email reflecting discussion, dated Jan 8, 2007, two weeks after decision: "regarding termination, he has forfeited compensation, $1630 in airfare, etc

Hodes: how long did BW drunk work for your comp? Profit from his work?

Prince: don't know how long. Profit prolly in the 10.5% range. Can't apologize for drunk's behaviour. We provide "dos and don'ts"...can't "flog" him...sole jurisdiction of DoJ. Investigation ongoing.

Hodes: this was a pot'l murder, was it not?

Prince: (consulting with counsel) "beyond watching det shows, IANAL...don't know how to nuance that."
(Grr!)

Sarbanes (D-MD): you keep saying that employees who break rules have one decision, "aisle or window," but your penalty to drunk employee who shot guard was a minor financial penalty. If that's the only deterrent, then that's not much considering how much they get paid. The worst that's gonna happen is maybe give up a bonus in last paycheque.

Prince: also get security clearance pulled and unlikely to work for US gov again. (RollingMahEyes)

Sarbanes: not same as prosecution for crime or court-martial.

(Repub is interrupting and angry...Waxman will restore Sarbanes' time.)

Sarbanes: wouldn't you agree that crim consequences would be more appropriate or at least possible?

Prince: welcome accountability. not hiding anything.

Sarbanes: wrt drunk murderer, you said you'd be happy to see him prosecuted...I'd like to see you *advocate* for reform in the rules and for strengthening accountability.

Prince: we support that fully.

1:45 PM
Welch (D-Vermont) interrupted by buzzer...vote time?

Welch: 51% contracts to BW 493$ mill no-competition . Correct?

Prince: don't know.

Welch: since 2003, contracts >$1 billion, correct?

Prince: don't know. There's some stuff in cmte's report that are inaccurate.

Welch: $50-60 000 to BW employee but $445 000 cost to taxpayer

Prince: dunno

Welch: You hire recently retired military. Recruit and benefit from taxpayer-funded training of military personnel. Contracts have surged since 2003, since war began.

Prince: the security of the world has changed, yes.

Welch: how much were you paid in 2006? Estimate.

Prince: >$1 million.

Welch: you indicated 90% contracts from fed gov. You told Hunter that profit was ~10%. If BW has $1 bill in contracts since 2003, and there's 10% profit...that's $100 million.

Prince: some contracts we lose money on. Lost helicopters, for e.g.

Murphy (D-CT): followup on Welch...why can't you tell us specifically what your profit was? We pay 90% your salary as taxpayers...

Prince: we are a private company. Healthy competition. "Key word: private."

(Prince consulting with counsel)

Murphy: you don't believe it's in best interest of BW or cmte to have discussions about profit, guv contracts?

Prince: not to that level of detail.

Murphy: approximation of profit, given 90% taxpayer contribution to BW

Prince: will give written answer. Not sure of that number. How can calc depreciation of assets, given helicopters, shooting at our assets in Iraq/Afghanistan.

Murphy: hard to believe CEO can't give approx of annual profits.

Prince: "people will tell you I'm not a financially driven guy"

Murphy: foreign nationals working for BW? %ge? ~1/3 foreign nationals, according to stmt.

Prince: 129/576.

Murphy: that is "not a handful"

1:52 PM
Lynch (D-MA): dozen or so times I've gone to Iraq/Afghanistan, I would bet 1/2 times we were under BW protection, at least part of the time. Personal experience tells me that BW employees did a very good job. Brave. Brave Americans Rolling Eyes Find myself having difficult time criticizing employees, as I'm in their debt. Problem: if *I* have a problem criticizing BW, what about the State dept employees, whom you protect everyday? There's a heavy debt of gratitude, but they're the very same people who are resp for holding you accountable in your contract and the conduct of your employees. That's an impossible conflict for them to resolve.

Lynch: internal emails from State dept. Raise questions about BW conduct, even in cases of death of Iraqis...state primary response was to make monetary compensation "to put this behind us"....most serious consequence appears to be termination of employment. Negroponte claimed firing of weapons was monitored, but there are no documents indicating such investigations.

Lynch: reading from emails/state dept. "better off getting this case...behind us" and mentions $5 000 for family of deceased Iraqi. Another example of BW killing of civilian near area of convoy travel; criticizes some "crazy sum" mentioning $250 000 setting "terrible precedent," with Iraqis "trying to get killed by our guys" for monetary gain. (OMFG!)

Lynch: Does it not make sense to have an indy Inspector General reviewing these cases instead of the State Dept?

(possible break? No. Prince very annoyed but wants to get the last two questioners over with. Little brat expression)

2:07 PM
Holmes-Norton (D-Wash DC): worries about 'falling off a cliff' with mercenary army. Countries fight wars where people support them, provide troops to fight wars. Your contract w/State: you supply contractors as independents, w/o benefits, retirement, etc.

Prince: each has an insurance pckg.

HN: DynCorp and Triple Canopy treat personnel as employees and not indy contracted, paying benefits etc. Does BW hire personnel as indy contractors to avoid legal responsibility?

Prince: no.

HN: disturbed by legal confusion about responsibilities of contractors.

Prince: (interrupting) we provide an optional 401(k) program for our personnel...

HN: my concern isn't mainly with benefits...it's with BW contractors (AFAIK) operate under the direct command of Prince, under law of US in *some* fashion...unclear after all day or hearings whether BW subject to law in a way our citizens expect. Need investigation to clarify what law, if any, such companies and employees should answer to.

Prince: FBI investigation about Sept 16 incident proves that accountability is in place...it's working. We provide equipment, training to get into theatre...when we get into theatre, they're under STATE DEPT control.

Jan Schakowsky (D-Illinois, guest of cmte, not a reg member): describes death of BW employee in Fallujah in 2004. Wants to introduce legislation.
Mr Prince, you did not state that your employees were all Americans. Foreign personnel?

Prince: camp guards, gate guards, some are foreign nationals.

Schakowsky: former commanders from Chile? Ones who worked under Pinochet? Did BW use any contractors w/ties to Pinochet?

Prince: we hired some Chileans. Any foreigner works for State dept has high-clearance conducted by State. Goes back to US Embassy in Chile to ensure no criminal record.

Schakowsky: but one of your associates was indicted in Chile...

Prince: not an assoc. One of our vendors, maybe.

Schakowsky: did Chileans get security clearance? Provided w/classified info? On your website, there was a jobs fair advertized in Bucharest. Recruited Serbs and former Yugoslav...would you know if people had been associ'd w/Pinochet or Milosevic?

Prince: a high public trust clearance is required by State dept...

Schakowsky: we should check into that process. You said you as a company wouldn't work overseas w/countries don't approve of. But Chile didn't participate as a COUNTRY in Iraq. But Chileans have been hired...you don't have any qualms about that?

Prince: persons have a free right to contract.

Waxman: acknowledged presence of daughter and wife of BW employee in Fallujah who died in 2004. Felt their husband wasn't given adequate training for mission to Fallujah. Don't have time to cover this today.

Waxman: thank you for coming, Prince.

Davis: anything to add, Prince?

Prince: thx for having me. Invite you to BW operations to observe what we do.

(Prince is dismissed)
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