Who Won in Afghanistan? Private Contractors

Dion Nissenbaum, Jessica Donati and Alan Cullison / Wall Street Journal

 (January 1, 2021) — The US lost its 20-year campaign to transform Afghanistan. Many contractors won big.

Those who benefited from the outpouring of government money range from major weapons manufacturers to entrepreneurs. A California businessman running a bar in Kyrgyzstan started a fuel business that brought in billions in revenue. A young Afghan translator transformed a deal to provide forces with bed sheets into a business empire including a TV station and a domestic airline.

Two Army National Guardsmen from Ohio started a small business providing the military with Afghan interpreters that grew to become one of the Army’s top contractors. It collected nearly $4 billion in federal contracts, according to publicly available records.

Four months after the last American troops left Afghanistan, the US is assessing the lessons to be learned. Among those, some officials and watchdog groups say, is the reliance on battlefield contractors and how that adds to the costs of waging war.

Since the Sept. 11, 2001 attacks, military outsourcing helped push up Pentagon spending to $14 trillion, creating opportunities for profit as the wars in Afghanistan and Iraq stretched on.

One-third to half of that sum went to contractors, with five defense companies — Lockheed Martin Corp., Boeing Co., General Dynamics Corp., Raytheon Technologies Corp. and Northrop Grumman Corp. — taking the lion’s share, $2.1 trillion, for weapons, supplies and other services, according to Brown University’s Costs of War Project, a group of scholars, legal experts and others that aims to draw attention to what it calls the hidden impact of America’s military.

A panoply of smaller companies also made billions of dollars with efforts including training Afghan police officers, building roads, setting up schools and providing security to Western diplomats.

During the past two decades, both Republican and Democratic administrations saw the use of contractors as a way to keep the numbers of troops and casualties of service members down, current and former officials said.

When fighting a war with an all-volunteer military smaller than in past conflicts, and without a draft, “you have to outsource so much to contractors to do your operations,” said Christopher Miller, who deployed to Afghanistan in 2005 as a Green Beret and later became acting defense secretary in the final months of the Trump administration.

The large amounts of money being spent on the war effort and on rebuilding Afghanistan after years of conflict strained the US government’s ability to vet contractors and ensure the money was spent as intended.

The US Special Inspector General for Afghanistan Reconstruction, created to monitor the almost $150 billion in spending on rebuilding the country, catalogued in hundreds of reports waste and, at times, fraud. A survey the office released in early 2021 found that, of the $7.8 billion in projects its inspectors examined, only $1.2 billion, or 15%, was spent as expected on new roads, hospitals, bridges, and factories. At least $2.4 billion, the report found, was spent on military planes, police offices, farming programs and other development projects that were abandoned, destroyed or used for other purposes.

The Pentagon spent $6 million on a project that imported nine Italian goats to boost Afghanistan’s cashmere market. The project never reached scale. The US Agency for International Development gave $270 million to a company to build 1,200 miles of gravel road in Afghanistan. The USAID said it canceled the project after the company built 100 miles of road in three years of work that left more than 125 people dead in insurgent attacks.

Maj. Rob Lodewick, a Pentagon spokesman, said the “dedicated support offered by many thousands of contractors to US military missions in Afghanistan served many important roles to include freeing up uniformed forces for vital war fighting efforts.”

John Sopko, the special inspector general for Afghanistan reconstruction since 2012, who documented the failures of contractors for years, said that many of them were doing their best to fulfill the demands placed on them by policymakers who made poor decisions.

“It’s so easy with a broad brush to say that all contractors are crooks or war profiteers,” said Mr. Sopko. “The fact that some of them made a lot of money—that’s the capitalist system.”

American use of military contractors stretches back to the Revolutionary War, when the Continental Army relied on private firms to provide supplies and even carry out raids on ships. During World War II, for every seven service members, one contractor served the war effort, according to the Congressional Budget Office.

More recently, the practice took off in the 1990s, around the time of the Gulf War. Then the decision after 9/11 to prosecute a global war on terror caught the Pentagon short-handed, coming after a post-Cold War downsizing of the American military.

In 2008, the US had 187,900 troops in Afghanistan and Iraq, the peak of the US deployment, and 203,660 contractor personnel.

The ratio of contractors to troops went up. When President Barack Obama ordered most US troops to leave Afghanistan at the end of his second term, more than 26,000 contractors were in Afghanistan, compared with 9,800 troops.

By the time President Donald Trump left office four years later, 18,000 contractors remained in Afghanistan, along with 2,500 troops.

“Contracting seems to be moving in only one direction — increasing — regardless of whether there is a Democrat or Republican in the White House,” said Heidi Peltier, program manager at the Costs of War Project.

Ms. Peltier said the reliance on contractors has led to the rise of the “camo economy,” in which the US government camouflages the costs of war that might reduce public support for it.

More than 3,500 US contractors died in Afghanistan and Iraq, according to statistics from the Labor Department that it says are incomplete. More than 7,000 American service members died during two decades of war.

One entrepreneur who found an opportunity was Doug Edelman, who hails from Stockton, Calif., and opened a bar and a fuel-trading business in the Kyrgyz capital of Bishkek in 1998. Three years later, when the war began in neighboring Afghanistan, Bishkek morphed into a hub for US troops and supplies. Mr. Edelman teamed up with a Kyrgyz partner to run two companies, Red Star and Mina Corp., which became vital links in the war effort, former colleagues said.

After winning a series of Pentagon single-source contracts, which allow the Pentagon to bypass the conventional bidding process, those colleagues said, Mr. Edelman’s firms supplied fuel for a Bishkek-based fleet of US Air Force C-135 air tankers that performed midair refueling operations over Afghanistan. Inside Afghanistan, his company built a fuel pipeline at Bagram Air Base.

His companies won billions of dollars in contracts, and Mr. Edelman earned hundreds of millions of dollars, according to a lawsuit filed in California in 2020 by a former colleague who said he was later cut out from equity in one of Mr. Edelman’s businesses. Mr. Edelman took up residence in the London mansion that once belonged to former media mogul Conrad Black, according to court filings and the former colleagues.

Mr. Edelman denied the allegations in his response to the lawsuit. He declined to comment.

The Mission Essential Group, the Ohio-based company that grew to become the Army’s leading provider of war zone interpreters in Afghanistan, exemplifies the arc of contracting in Afghanistan.

Mission Essential got its start in 2003 after two Army National Guardsmen, Chad Monnin and Greg Miller, commiserated in an Arabic language class over what they considered the poor quality of interpreters used by the military, and wanted to do better.

In 2007 it won a five-year, $300 million contract to provide the Army with interpreters and cultural advisers in Afghanistan.

The company grew rapidly. Mr. Monnin, who former Mission Essential employees said had been known to sleep in his car to save money on hotel rooms, moved into a 6,400-square-foot, $1.3 million dollar home next to a country club golf course, according to public records. He bought a classic 1970s Ferrari sports car.

While interpreters were well-paid when the contracts were flush, former Mission Essential employees said, the pay for Afghans decreased as the business contracted.

As the military mission in Afghanistan began to scale back in 2012, Mission Essential said there was pressure to reduce costs. Mission Essential said it renegotiated contracts with Afghan linguists that reduced average monthly pay by about 20-to-25%.

Average monthly income for Afghan linguists fell from about $750 in 2012 to $500 this year, the company said.

“They were taking in billions from the US government,” said Anees Khalil, an Afghan-American linguist who worked for a Mission Essential subcontractor for several months. “The way they were treating linguists was very inhumane.”

He and other former employees said some Afghan linguists working alongside US soldiers in the toughest parts of the country were paid as little as $300 a month. The company said it had no records that anyone was paid $300 a month when working full-time.

Mission Essential said its interpreters were “extremely well paid compared to average incomes in the market” and that the company put a priority on ensuring they were well cared for. Mission Essential said it went to great lengths up until the very end to help its employees in Afghanistan escape Taliban rule.

“Supporting this work is not about profits,” said Mr. Miller. “It’s about preserving our national security and our American way of life.”

In January 2010, an Afghan interpreter working for Mission Essential on an Army Special Forces base near Kabul grabbed a gun and killed two US soldiers. The families of the two soldiers killed — Capt. David Thompson and Specialist Marc Decoteau — along with Chief Warrant Officer Thomas Russell, who was injured, filed suit, accusing Mission Essential of failing to properly screen and oversee the interpreter. The families said their lawsuit aimed to get the government to address what they called inadequate supervision of contractors.

“These contracts are extremely lucrative and in our opinion financial considerations could have outweighed the proper performance of contract requirements,” said the families in a statement.

The two sides settled the suit in 2015 for undisclosed terms.

Mr. Miller called the 2010 shooting a “total tragedy,” and said it was the sole such incident in 17 years of the company’s work in war zones. He said Mission Essential had been cleared by the Army of any criminal culpability for the attack. The Army declined to comment.

By the end of 2010, Mission Essential said it employed nearly 7,000 linguists working with the US military in Afghanistan. It made more than $860 million in revenue from the Defense Department in 2012.

As the troop surge wound down, Mission Essential’s federal contracts fell, according to public records. Mr. Miller said he and Mr. Monnin had different visions for how the company should grow. Mr. Monnin, who declined to comment on his work at Mission Essential, agreed to sell his share of the company to Mr. Miller.

Divisions also erupted between Mr. Miller and two board members in an unresolved lawsuit filed in 2018. Their suit accused Mr. Miller of hiring unqualified relatives, spending millions in company money on personal matters, having the company pay him $1 million for an airplane to fly his family members around and taking $500,000 a year in salary without board approval.

Mr. Miller said Mission Essential is a family business and that two of his brothers work for the company in positions they are “highly qualified” to fill. He said that the plane was used by executives to travel to business meetings around the country and was sold when it was no longer needed.

Mr. Miller denied the allegations and accused the board members in court filings of trying to use Mission Essential as their personal cash machine and of using illegal drugs, putting the company’s role as a federal contractor at risk. Mr. Miller accused the pair of using the courts to try and secure a better deal for giving up their stake in the company.

Those counterclaims are “unfounded and blatantly false,” said Katherine Connor Ferguson, the attorney for the board members, Scott Humphrys and Chris Miller, who isn’t related to Greg Miller.

By the time President Biden ordered the last American troops to leave Afghanistan in August, Mission Essential had cut its staff to about 1,000. Almost 90 employees were killed during the war, Mr. Miller said. The last 22 in Afghanistan worked alongside US forces and flew out of Kabul on the final few planeloads of America’s troops in August, he said.

By then, Mr. Miller was working to reposition Mission Essential. The company secured a $12 million contract to provide the Army with interpreters in Africa and worked to diversify by buying a technology company.

Elisa Cho, Jim Oberman and Ehsanullah Amiri contributed to this article.

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