THE WORLD was a very different place on September 10, 2001, when Donald Rumsfeld stepped to the podium at the Pentagon to deliver one of his first major addresses as Defense Secretary under President George W. Bush. For most Americans, there was no such thing as Al Qaeda, and Saddam Hussein was still the president of Iraq. Rumsfeld had served in the post once before—under President Gerald Ford from 1975 to 1977—and he returned to the job in 2001 with ambitious visions. That September day in the first year of the Bush administration, Rumsfeld addressed the Pentagon officials in charge of overseeing the high-stakes business of defense contracting—managing the Halliburtons, DynCorps, and Bechtels. The Secretary stood before a gaggle of former corporate executives from Enron, Northrop Grumman, General Dynamics, and Aerospace Corporation whom he had tapped as his top deputies at the Department of Defense, and he issued a declaration of war.

“The topic today is an adversary that poses a threat, a serious threat, to the security of the United States of America,” Rumsfeld thundered.1 “This adversary is one of the world’s last bastions of central planning. It governs by dictating five-year plans. From a single capital, it attempts to impose its demands across time zones, continents, oceans, and beyond. With brutal consistency, it stifles free thought and crushes new ideas. It disrupts the defense of the United States and places the lives of men and women in uniform at risk.” Pausing briefly for dramatic effect, Rumsfeld—himself a veteran Cold Warrior—told his new staff, “Perhaps this adversary sounds like the former Soviet Union, but that enemy is gone: our foes are more subtle and implacable today. You may think I’m describing one of the last decrepit dictators of the world. But their day, too, is almost past, and they cannot match the strength and size of this adversary. The adversary’s closer to home. It’s the Pentagon bureaucracy.” Rumsfeld called for a wholesale shift in the running of the Pentagon, supplanting the old DoD bureaucracy with a new model, one based on the private sector. The problem, Rumsfeld said, was that unlike businesses, “governments can’t die, so we need to find other incentives for bureaucracy to adapt and improve.” The stakes, he declared, were dire—”a matter of life and death, ultimately, every American’s.” That day, Rumsfeld announced a major initiative to streamline the use of the private sector in the waging of America’s wars and predicted his initiative would meet fierce resistance. “Some might ask, How in the world could the Secretary of Defense attack the Pentagon in front of its people?” Rumsfeld told his audience. “To them I reply, I have no desire to attack the Pentagon; I want to liberate it. We need to save it from itself.”

The next morning, the Pentagon would literally be attacked as American Airlines Flight 77—a Boeing 757—smashed into its western wall. Rumsfeld would famously assist rescue workers in pulling bodies from the rubble. But it didn’t take long for Rumsfeld, the chess master of militarism, to seize the almost unthinkable opportunity presented by 9/11to put his personal war— laid out just a day before—on the fast track. The world had irreversibly changed, and in an instant the future of the world’s mightiest military force had become a blank canvas on which Rumsfeld and his allies could paint their masterpiece. The new Pentagon policy would draw heavily on the private sector, emphasize covert actions, sophisticated weapons systems, and greater use of Special Forces and contractors. It became known as the Rumsfeld Doctrine. “We must promote a more entrepreneurial approach: one that encourages people to be proactive, not reactive, and to behave less like bureaucrats and more like venture capitalists,” Rumsfeld wrote in the summer of 2002 in an article for Foreign Affairs titled “Transforming the Military.” 2 Rumsfeld’s “small footprint” approach opened the door for one of the most significant developments in modern warfare—the widespread use of private contractors in every aspect of war, including in combat. Among those to receive early calls from the administration to join a “global war on terror” that would be fought according to the Rumsfeld Doctrine was a little-known firm operating out of a private military training camp near the Great Dismal Swamp of North Carolina. Its name was Blackwater USA. Almost overnight following the great tragedy of September 11, a company that had barely existed a few years earlier would become a central player in a global war waged by the mightiest empire in history. “I’ve been operating in the training business now for four years and was starting to get a little cynical on how seriously people took security,” Blackwater’s owner Erik Prince told Fox News host Bill O’Reilly shortly after 9/11. “The phone is ringing off the hook now.”

But the story of Blackwater doesn’t begin on 9/11 or even with its executives or its founding. In many ways, it encapsulates the history of modern warfare. Most of all, it represents the realization of the life’s work of the officials who formed the core of the Bush administration’s war team.

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From accusations that the weapons of mass destruction dossier had been sexed-up to withdrawal of British troops from Basra

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During the 1991 Gulf War, Dick Cheney—Rumsfeld’s close ally—was Secretary of Defense. One in ten people deployed in the war zone at that time was a private contractor, a ratio Cheney was doggedly determined to ratchet up. Before he departed in 1993, Cheney commissioned a study from a division of the company he would eventually head, Halliburton, on how to quickly privatize the military bureaucracy. Almost overnight, Halliburton would create an industry for itself servicing U.S. military operations abroad with seemingly infinite profit potential. The more aggressively the U.S. expanded its military reach, the better for Halliburton’s business. It was the prototype for the future. In the ensuing eight years of governance by Bill Clinton, Cheney worked at the influential neoconservative think tank the American Enterprise Institute, which led the charge for an accelerated privatization of the government and military. By 1995, Cheney was at the helm of Halliburton building what would become the U.S. government’s single largest defense contractor. President Clinton largely embraced the privatization agenda, and Cheney’s company—along with other contractors—was given lucrative contracts during the Balkans conflict in the 1990s and the 1999 Kosovo war. One military consulting firm, the Virginia-based Military Professional Resources Incorporated, staffed by retired senior military officials, was authorized by the Clinton administration in the mid-1990s to train the Croatian military in its secessionist war against Serb-dominated Yugoslavia, a contract that ultimately tipped the balance of that conflict. That contract was a foreshadowing of the kind of private-sector involvement in war that would become standard in the war on terror. But privatization was only part of the broader agenda. Cheney and Rumsfeld were key members of the Project for a New American Century, initiated in 1997 by neoconservative activist William Kristol.4 The group pressed Clinton to enact regime change in Iraq, and its principles, which advocated “a policy of military strength and moral clarity,” would form the basis for much of the Bush administration’s international agenda.

In September 2000, just months before its members would form the core of the Bush White House, the Project for a New American Century released a report called Rebuilding America’s Defenses: Strategy, Forces and Resources for a New Century. In laying out PNAC’s vision for overhauling the U.S. war machine, the report recognized that “the process of transformation, even if it brings revolutionary change, is likely to be a long one, absent some catastrophic and catalyzing event—like a new Pearl Harbor.”6 A year to the month later, the 9/11 attacks would provide that catalyst: an unprecedented justification to forge ahead with this radical agenda molded by a small cadre of neoconservative operatives who had just taken official power.

The often-overlooked subplot of the wars of the post-9/11 period is the outsourcing and privatization they have entailed. From the moment the Bush team took power, the Pentagon was stacked with ideologues like Paul Wolfowitz, Douglas Feith, Zalmay Khalilzad, and Stephen Cambone and with former corporate executives—many from large weapons manufacturers— like Under Secretary of Defense Pete Aldridge (Aerospace Corporation), Army Secretary Thomas White (Enron), Navy Secretary Gordon England (General Dynamics), and Air Force Secretary James Roche (Northrop Grumman). The new civilian leadership at the Pentagon came into power with two major goals: regime change in strategic nations and the enactment of the most sweeping privatization and outsourcing operation in U.S. military history—a revolution in military affairs. After 9/11 this campaign became unstoppable.

The swift defeat of the Taliban in Afghanistan emboldened Rumsfeld and the administration as they began planning for the centerpiece of the neoconservative crusade: Iraq. From the moment the U.S. troop buildup began in advance of the invasion, the Pentagon made private contractors an integral part of the operations. Even as the U.S. gave the public appearance of attempting diplomacy, behind closed doors Halliburton was being prepped for its largest operation in history. When U.S. tanks rolled into Baghdad in March 2003, they brought with them the largest army of private contractors ever deployed in a war. By the end of Rumsfeld’s tenure, there were an estimated 100,000 private contractors on the ground in Iraq—an almost oneto- one ratio to active-duty U.S. soldiers.7 To the great satisfaction of the war industry, before Rumsfeld stepped down, he took the extraordinary step of classifying private contractors as an official part of the U.S. war machine. In the Pentagon’s 2006 Quadrennial Review, Rumsfeld outlined what he called a “roadmap for change” at the DoD, which he said had started in 2001.8 It defined the “Department’s Total Force” as “its active and reserve military components, its civil servants, and its contractors—constitut[ing] its warfighting capability and capacity. Members of the Total Force serve in thousands of locations around the world, performing a vast array of duties to accomplish critical missions.”

Coming as it did in the midst of an open-ended, loosely defined global war, this formal designation represented a radical rebuke of the ominous warnings laid out by President Eisenhower in his farewell address to the nation decades earlier during which he envisioned the “grave implications” of the rise of “the military-industrial complex.” In 1961, Eisenhower declared, “The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.” What has unfolded in the ensuing years and particularly under the Bush administration is nothing less than the very scenario Eisenhower darkly prophesied.

While the war on terror and the Iraq occupation have given birth to scores of companies, few if any have experienced the meteoric rise to power, profit, and prominence that Blackwater has. In less than a decade, it has risen out of a swamp in North Carolina to become a sort of Praetorian Guard for the Bush administration’s “global war on terror.” Today, Blackwater has more than 2,300 private soldiers deployed in nine countries, including inside the United States. It maintains a database of 21,000 former Special Forces troops, soldiers, and retired law enforcement agents on whom it could call at a moment’s notice. Blackwater has a private fleet of more than twenty aircraft, including helicopter gunships and a surveillance blimp division. Its 7,000-acre headquarters in Moyock, North Carolina, is the world’s largest private military facility. It trains tens of thousands of federal and local law enforcement agents a year and troops from “friendly foreign nations. The company operates its own intelligence division and counts among its executives senior ex-military and intelligence officials. It recently began constructing new facilities in California (“Blackwater West”) and Illinois (“Blackwater North”), as well as a jungle training facility in the Philippines. Blackwater has more than $500 million in government contracts—and that does not include its secret “black” budget operations for U.S. intelligence agencies or private corporations/individuals and foreign governments. As one U.S. Congressmember observed, in strictly military terms, Blackwater could overthrow many of the world’s governments.

Blackwater is a private army, and it is controlled by one person: Erik Prince, a radical right-wing Christian mega-millionaire who has served as a major bankroller not only of President Bush’s campaigns but of the broader Christian-right agenda. In fact, as of this writing Prince has never given a penny to a Democratic candidate—certainly his right, but an unusual pattern for the head of such a powerful war-servicing corporation, and one that speaks volumes about the sincerity of his ideological commitment. Blackwater has been one of the most effective battalions in Rumsfeld’s war on the Pentagon, and Prince speaks boldly about the role his company is playing in the radical transformation of the U.S. military. “When you ship overnight, do you use the postal service or do you use FedEx?” Prince recently asked during a panel discussion with military officials. “Our corporate goal is to do for the national security apparatus what FedEx did to the postal service.”

Perhaps the most telling sign that such a transformation had taken place came when the White House outsourced the job of protecting America’s most senior officials in Iraq to Blackwater beginning in 2003. As L. Paul Bremer, Bush’s envoy in the first year of the occupation, hunkered down in Baghdad to implement the Bush agenda, he was protected by Blackwater, as every successive U.S. Ambassador there has been. In contrast to active-duty soldiers who are poorly paid, Blackwater’s guards were given six-figure salaries. “Standard wages for PSD (personal security detail) pros [in Iraq] were previously running about $300 [per man] a day,” Fortune reported at the time. “Once Blackwater started recruiting for its first big job, guarding Paul Bremer, the rate shot up to $600 a day.”10 With almost no public debate, the Bush administration has outsourced to the private sector many of the functions historically handled by the military. In turn, these private companies are largely unaccountable to the U.S. taxpayers from whom they draw their profits. Some began comparing the mercenary market in Iraq to the Alaskan Gold Rush and the O.K. Corral. As The Times of London put it at the time, “In Iraq, the postwar business boom is not oil. It is security.”

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