The Blackwater effect on contractors

Ashley Milne-Tyte Nov 28, 2007


Doug Krizner: British security firm Armor Group International reported weak profits yesterday. And it did all but blame its rival, Blackwater. Armor has seen fewer contracts since Blackwater employees killed 17 Iraqi civilians in September. Ashley Milne-Tyte reports on whether the incident has adversely affected other private contractors.

Ashley Milne-Tyte: The Blackwater shootings may have hurt the reputations of private-security firms, but not necessarily their bottom lines.

Peter Singer is with the Brookings Institution, and wrote the book “Corporate Warriors.” He says even Blackwater itself hasn’t lost its contract. Yet.

Peter Singer: A lot of people think it’s gonna end up, the next time it comes up to bid. But there isn’t like you’ve seen a wave of the U.S. government announcing “OK, actually now we’re canceling all of these contracts that we have here, there and everywhere.” That just hasn’t happened in the marketplace yet.

He says the fortunes of these firms hinge on multiple factors:

Singer: It’s legal factors, it’s security factors, it’s grand politics on a global level and its politics on a very small micro-level.

For now, private security is still in high demand in Iraq. And governments and corporations aren’t the only ones hiring. Singer says his organization found that one human rights group had its own sniper team.

I’m Ashley Milne-Tyte for Marketplace.

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