BILL MOYERS:: Welcome to the Journal.  (Excerpted)

You could not miss Erik Prince this week. The founder and top gun of Blackwater usually keeps a low media profile. But there he was all over the place, in a carefully orchestrated campaign to put the best face on a bad situation:

ERIK PRINCE: "I’m an American working for America. Anything we do is to support U.S. Policy. You know the definition of a mercenary is a professional soldier that works in the pay of a foreign army. I’m an American working for America…."

BILL MOYERS: As the press was helping him spin his story, he was blaming the press….Prince stuck to his well-rehearsed talking points, no matter where he showed up….One subject he evaded time and again was his close ties to people in high places who hand out the government contracts that pay for his private army.

CHARLIE ROSE: You give a lot of money to the Republican Party, fair amount.

ERIK PRINCE: Relative to a lot, not very much but -

CHARLIE ROSE: "This is America. You are allowed to do and support whoever you want to. Your sister, her husband ran for governor of Michigan. Your mother is a very enthusiastic supporter of causes as well as, I assume, the Republican Party as well. Your sister supported George Bush 41. And you supported Pat Buchanan. Why was there that split?

BILL MOYERS: So what was and wasn’t said in this spectacle of spin? For some answers we turn to a one-man truth squad who has been reporting on Blackwater and Erik Prince’s influence. Jeremy Scahill is an independent investigative journalist who wrote this recent bestselling book: Blackwater: The Rise Of The World’s Most Powerful Mercenary Army.  Jeremy Scahill is a Puffin Foundation Writing Fellow at the Nation Institute. He’s reported from Iraq, the Balkans and Nigeria, among other places, he’s a co-winner of the George Polk Award For Investigative Reporting.

BILL MOYERS::

From watching the interviews, what was the message that you think Prince was trying to get out?JEREMY SCAHILL: ….here you have the man who owns the company providing the largest private army on the US government payroll in Iraq. A billion dollars in contracts. Twenty-seven of his men killed in Iraq. We don’t know how many people he killed. No private actor in the occupation of Iraq has had more of a devastating impact on events in Iraq than Blackwater. And I just felt watching that hearing– and I went down for it– that many of the Democrats hadn’t done their homework….let’s remember here, Blackwater says they’re not a mercenary company. Erik Prince calls that a slanderous term. And they’re not even in the private military company business. They’re in the peace and stability industry…. And the democratic plan says, let’s send an FBI field office over in Baghdad monitoring 180,000 contractors. I mean, there are more contractors in Iraq right now than there are US soldiers.

And so the idea is that the FBI is gonna go around Iraq. They’re gonna be investigating crimes of contractors. Interviewing witnesses, presumably in very dangerous places. And then, they’re going to arrest the individual in question. Bring them back to the United States. And then, prosecute them in a US civilian court. All of this coming from the Bush justice department. I mean, I’ve never heard a more insane plan. And– and so, what that bill will give Erik Prince and other mercenary companies the opportunity to do is to sit down and say, there are laws that govern us. We’re accountable under US law. But they know well that it only exists on paper. And that there will be a few token prosecutions. It’s impossible to monitor the activities of 180,000 personnel.

JEREMY SCAHILL: Well, ….I started going to Iraq in 1998. And I went in in the weeks leading up to the Clinton administration’s attack on Baghdad in December of– of '98. And I had actually spent a fair bit of time in the city of Fallujah….. — and on March 31st, 2004 when four Blackwater operatives were ambushed and– and killed in Fallujah, their bodies dragged through the streets, burned, strung up from a bridge….then, it emerged that in fact they were these mercenaries working for a– a private company called Blackwater USA.

And– and we watched as the Bush administration then began to escalate the rhetoric. And it became clear that they were gonna lay siege to the city of Fallujah And what happened in the aftermath is well known. The– the US military was ordered to destroy the city. Hundreds of Iraqi civilians were killed. A number of US troops. And I began from a very simple question. How on earth were the lives of four corporate personnel– not US soldiers, not humanitarian workers. But how were the lives of these four corporate personnel worth the death of an entire Iraqi city? That siege had an incredibly devastating impact on events on the ground in Iraq. It gave rise to the Iraqi resistance. Fueled it. Attacks escalated against US forces. And it was– it was really the moment that the war turned over the deaths of these four Blackwater guys.

in Iraq, you’re talking about an occupation of a country. And without these private sector forces, without companies like as Blackwater, Triple Canopy and Dyncorp, the occupation wouldn’t be tenable.

BILL MOYERS:: Why?

JEREMY SCAHILL: Well, right now in Iraq, there are 180,000 contractors operating alongside 170,000 US troops. So it’s effectively a doubling or more than doubling of the occupation force. What this does is it subverts the citizenry in the United States. You no longer have to have a draft. You don’t have to depend on your own citizens to fight your wars. You can simply hire up the poor of the world to work for American and British companies occupying another country….well, General Petraeus himself has been guarded by private contractors in Iraq. I mean, what message did that send when the general who’s overseeing the surge in Iraq is guarded at times not by the US military, but by private forces….Erik Prince likes to describe Blackwater as the sort of Federal Express of the national security apparatus….But the fact is, the US military is the junior partner in the coalition that’s occupying Iraq to these private companies. There are over 170 mercenary companies like Blackwater operating in Iraq right now. That’s almost as many nations as are registered at the UN. And I think this isn’t just about Iraq. It’s also looting the US treasury.

I think we’re in the midst of the most radical privatization agenda in our nation’s history. We of course see it in schools. We see it in the health care system, in prisons. And now, we’re seeing it full blown in the war machine. What I ultimately see as the real threat here is that the system of the very existence of the nation state I think is at stake here…. Dyncorps for years, which is a massively publicly traded mercenary outfit, has been in Columbia for years. They’ve been in the Balkans. They’re all over the place.

The Columbian government receives 630 million dollars a year to fight the so-called war on drugs. Of that 630 million dollars, half of it goes to US war contractors. They’re in Bolivia. They’re in Ecuador. They’re in Columbia. Blackwater recently won a fifteen billion dollar contract that it’s gonna share with four other companies to fight terrorists with drug ties.

….this is a man who is building up nothing short of a parallel national security apparatus. He not only has his Blackwater Security which is what’s deployed in Iraq. He has a maritime division, an aviation division. He recently started his own privatized intelligence company called Total Intelligence Solutions that– that’s headed by a thirty year veteran of the CIA, the man who led the hunt for Osama Bin Laden, Colfer Black, who oversaw the extraordinary rendition program.

This is the man who promised President Bush that he was gonna have his operative in Afghanistan chop off Osama Bin Laden’s head, place it in a box with dry ice and then have it hand delivered to President Bush. He’s now the number two man at Blackwater USA. He’s the vice chairman of the company. And he’s heading up this private intelligence company called Total Intelligence Solutions.

Blackwater has just won a 92 million dollar contract from the Pentagon to operate flights throughout central Asia. This is a company that is manufacturing surveillance blimps and marketing them to the Department of Homeland Security. Their own armored vehicle called the Grizzly. I mean, Blackwater’s gonna be around for a very long time.

These are guys that have worked inside of Afghanistan. They’ve been responsible for so much death and destruction in Iraq. And it’s sort of– it’s the sanitizing of the role of Blackwater.

Erik Prince likes to portray Blackwater as this sort of apple pie operation, all-American operation. And yet, his company has recruited soldiers from all around the world and deployed them in Iraq. Chilean commandos some of whom trained and served under Augusto Pinochet–a Chilean recruiter who had been in Pinochet’s military…hired up scores of Chileans, brought them to North Carolina for evaluation and then sent them over to Iraq.

Chile was opposed to the occupation of Iraq. Was a rotating member of the security council at the time of the invasion opposing it. It said no. We won’t join the coalition of the willing. And so, Blackwater goes in and hires up soldiers from a country who’s home government is opposed to the war. And deploys them in Iraq. That’s a subversion of the sovereignty of the nation of Chile.

Blackwater has hired Colombian soldiers and paid them 34 dollars a day to be in Iraq as well. They’ve hired Bulgarians, Fijians, Poles. So, I’m not quite certain what– what Erik Prince is talking about. In fact, his very definition of mercenary describes Blackwater, which is a professional soldier serving a foreign power. That’s the definition Prince provides.

….Blackwater is certainly the beneficiary of the– the Republican monopoly in government. But this system has been bi-partisan for a very long time. When Hillary Clinton’s husband was in the White House, he was an aggressive supporter of the privatization of the war machine. Bill Clinton used mercenary forces in the Balkans.

Who do we think gave Dick Cheney’s company all of those contracts during the Nineties? We talk about Halliburton. It was Clinton. It was the Clinton administration. And and, Blackwater may be a– an extraordinary Republican company. But they’re gonna be around when there’s a Democrat in office.

….And Erik Prince has given over a quarter of a million dollars to Republican candidates. He’s also given money to the green party to defeat Democratic candidates in the 2006 election cycle. So, he’s a pretty committed supporter of the Republican party. But what I think is more interesting is Erik Prince’s connection to radical religious right organizations. 

BILL MOYERS: You say in your book, what is particularly scary, you acknowledge that the Democrats play this game, too, Clinton and so forth. But you write, "What is particularly scary about Blackwater’s role in a war that President Bush labeled a crusade is that the company’s leading executives are dedicated to a Christian supremacist agenda." Now, you go on and off with the evidence for that in the book. But when I read that, I thought, is that just a coincidence? I mean, Blackwater is not the result of his Christian or religious impulses. I mean, it’s a business operation, isn’t it?

JEREMY SCAHILL: Well, I mean, I believe that Erik Prince is an ideological foot soldier. And I do believe that he’s a Christian supremacist. And I think it’s very easy to explain that. I mean, look, this is the guy who gave a half a million dollars to Chuck Colson, the first person to go to jail for Watergate who’s now becoming a very prominent evangelical minister and an advisor to President Bush, one of the people behind the safe face initiatives….And I believe that these men do have an agenda that very closely reflects adherence to a sort of Crusader doctrine.

But Blackwater has emerged sort of as the– it’s almost like an armed wing of the administration in Iraq. Because it doesn’t work for the Pentagon. It works for the State Department. And the fact that Blackwater is such a politically connected company I think explains why you see this big push back. Because if I was Ambassador Ryan Crocker, I wouldn’t want to come within ten countries of the Blackwater body guards. I mean, when your body guards become more of a target than you, maybe it’s time to get a different security detail.

So, why is it so important to the US government that they keep Blackwater on the job in Iraq? I think part of it is an institutional loyalty. Blackwater is very fond of saying we’ve never lost a principle. No US diplomat has died under our watch.

(But what if) you’re one of the families of a victim of the Nasoor Square shooting where 17 people were killed and over 25 others were wounded. So, yes, Blackwater can walk around bragging about how they haven’t lost a single principle. All of their nouns have been kept alive, as they call it. But at what price? And at what price to the US soldiers in Iraq? You know, I’ve heard from so many soldiers, veterans who say, you know, we’re in a village somewhere. And things are going fine with the Iraqis. And we’ve reached the point where they’re not attacking us anymore. And we feel like there’s some good will that’s been generated.’ And in fact, this is an exact story that a translator attached to a special forces unit told me in an e-mail recently. And he said, you know, and then the PSD guys, the personal security detail guys, they come whizzing through with their VIP and they shoot up the town. And the Iraqis in town don’t understand that there’s a difference between the private forces and the military. And then they conduct revenge attacks against us. And so, it’s having a blow-back effect on the active duty military. The misconduct of these forces.

BILL MOYERS: (In preparation for this interview I had this thought)….The thought was, you know, suppose we had a national emergency. Suppose the terrorists struck again. And a President, President Hillary Clinton, or President Barack Obama declared marshal law in order to try to deal with this threat. And there was a private army of twenty thousand soldiers that I could call upon to throw a ring around the capital and make sure that the Congress didn’t leave town or didn’t get back to the capital if– how far fetched is that?

JEREMY SCAHILL: Well, I mean, I was in New Orleans in the aftermath of Hurricane Katrina. And I think we saw a real window into the possible future. You know, I was standing on a street corner in the French quarter on Bourbon Street. And I was talking to two New York City police officer who had come down to help. And this is just a couple of days after the hurricane had hit. And this car speeds up next to us. No license plates on it, a compact car. And three massive guys get out of it. And they have M-4 assault rifles, bullet proof vests, wearing khakis, wrap around sunglasses, baseball caps on. And they come up and they say to the cops, "Where are the rest of the Blackwater guys?" And my head sort of started, you know, I didn’t even hear the answer. I couldn’t believe what I was hearing. Where are the rest of the Blackwater guys? So, they get back in their vehicle and they speed off. And I said to this cop, Blackwater? You mean the guys in Iraq and Afghanistan? They said, oh, yeah. They’re all over the place down here. And so, I said, well, I’d like to talk to them. Where are they? And they said, you can go either way on the street, implying that they’re everywhere. So, I walked a little bit deeper into the French quarter. And sure enough, I encountered some Blackwater guys. And when I talked to them, they said that they were down there to confront criminals and stop looters.

BILL MOYERS: Who called them in? ….Within a week, Blackwater was given a contract from the Department of Homeland Security Federal Protective Service to engage in security operations inside of New Orleans. At one point, Blackwater had six hundred men deployed down there stretching from Mississippi through– from Texas through Mississippi and the Gulf. They were pulling in $240,000 a day. Some of these guys though had just been in Iraq two weeks earlier guarding the US ambassador. Now, they’re in New Orleans. They say, oh, we do this sort of as a vacation. One was complaining to me that there wasn’t enough action down here. And when I talked to them, they told me they were getting paid 350 dollars a day, plus a per diem.

BILL MOYERS: By homeland security?

JEREMY SCAHILL: Well, they were being paid by Blackwater. When I got Blackwater’s contract with the Department of Homeland Security, it turns out that Blackwater billed US taxpayers 950 dollars per man per day in the hurricane zone.

BILL MOYERS: A profit margin of 600 dollars.

JEREMY SCAHILL: Well, I mean, the math on this stuff is always complicated. And Erik Prince and his men are very good at drawing up charts and sort of, you know, just saying, well, there’s this detail and this detail. The Department of Homeland Security then did an internal review and they determined that it was the best value to the taxpayer, at a time when the poor residents of New Orleans were being chastised for how they used their two thousand dollar debit cards that often didn’t work, the ones provided by FEMA. 

….this is the point I’m making. The poor drowned. They are left without food. They’re called looters when they take perishable goods out of a store when they’ve been systematically neglected. The rich bring in their mercenaries to guard their properties or their businesses or their hotel chains. And I think it’s a window into what happens in a national emergency. And in this country, the poor are left to suffer and die and the rich bring in their mercenaries.

….the Bush administration has so maligned the United Nations and rendered it irrelevant and pulled the rug out from under it in so many ways. And I think that the last thing that is needed in Darfur is more private guns. I mean, who’s to say that’s what would happen if Blackwater gets sent into Darfur in the first place? I mean, who’s gonna be monitoring them and overseeing them? I don’t buy that the mercenaries are the solution to the crisis in Darfur. I–

BILL MOYERS: But Erik Prince told all of these– journalists, "We want more accountability. We welcome it."

JEREMY SCAHILL: This is one thing that I find fascinating. When Blackwater was sued– for wrongful death from the four guys killed in Fallujah in March of '04 and then Afghanistan plane crash, the legal argument that Blackwater put forward is quite an interesting one. "We can’t be sued." What they said is, "We should enjoy the same immunity from civilian litigation that’s enjoyed by the U.S. military."

BILL MOYERS: But to whom are they accountable? Who can hold them to judge them?

JEREMY SCAHILL: Well, no one apparently has held them to any kind of accountability thus far. Not a single one of them has ever been charged with any crimes whatsoever.

….Look, one of the really disturbing stories that’s come out of Iraq in the last year involving Blackwater was that last Christmas Eve inside of the heavily fortified green zone, a drunken, off-duty Blackwater contractor allegedly shot and killed a bodyguard for the Iraqi Vice President, Adel Abdul-Mahdi.

In the aftermath of that shooting, this individual was whisked out of Iraq, within 36 hours after that shooting. And then he actually returned back to the region working in Kuwait for another contractor with the Pentagon. The killing happened, December 24th 2006. February of 2007, this individual is back in the Middle East working for another U.S. military contractor and worked there until August. He hasn’t been charged with any crime whatsoever. We understand now that the Justice Department is investigating it. The Iraqis clearly labeled it a murder. And it created a major rift between Baghdad and Washington. Imagine if an Iraqi bodyguard shot and killed a bodyguard for Dick Cheney and then the Iraqis just whisked him out of the United States. I mean, what would happen? What message does this send? What does it say that in four years of occupation, hundreds of thousands of contractors, not a single one of them has been prosecuted? Ether we have tens of thousands of– mercenaries in Iraq who are actually Boy Scouts, or something is fundamentally rotten with that system.

BILL MOYERS: What about these suits that had been filed by some of the loved ones of the four contractors who were killed in Fallujah, before Fallujah? What about those lawsuits? Where are they going?

JEREMY SCAHILL: You know, when I read the 60 Minutes transcript and they mentioned the four men who the killed at Fallujah and then they said well– Blackwater has a memorial for them on the compound, I was waiting for them to say, "And the four families of the men are suing Blackwater for wrongful death." I mean, thi– this–

BILL MOYERS: They’ve had many law firms. And they’ve– they’ve tried to have the case thrown out. They’ve appealed all the way to the Supreme Court. And– twice, the Supreme Court rejected Ken Starr’s appeals. And the case is sort of caught up in a little bit of legal limbo right now. But it’s being watched very closely by all of the other war companies. Because it’s like the tobacco litigation of the ’90s. If that one domino goes down, it starts off a chain reaction. And so, a lot of people are paying very close attention to this.

JEREMY SCAHILL: ….I think that the U.S. government right now is in the midst of its most radical privatization agenda. Seventy percent of the national intelligence budget is farmed out to the private sector. We have more contractors than soldiers occupying Iraq. I think that what this does is it takes– it sanitizes it also for the American people. There’s not a draft.

There’s been, you know, almost 4,000 U.S. soldiers killed in Iraq; we don’t know how many private contractors. But that’s a relatively small number compared to Vietnam, for instance, where we talked about 65,000 body bags coming home. And already, people are outraged at it. And I see this as a real subversion of democratic processes in this country and a subversion of sovereignty of nations around the world.

And it also masks the true extent of the occupation when over half of your occupation force comes from the private sector. Bush almost never talks about it. He doesn’t have to own it in front of the American people. What I see in the bigger picture here is what the real revolution is in terms of U.S. politics is that they’re taking billions of dollars in public money. And they’re privatizing it.

You know, the Pentagon can’t give campaign contributions. The State Department can’t give campaign contributions. Blackwater’s executives can give contributions. DynCore’s, Ratheon, Northrop Grumman. And so what they’re doing is, they’re taking billions of dollars. And it’s making its way back into the campaign coffers of the very politicians that make the meteoric ascent of these companies possible. I really view this through the lens of it tearing away at the fabric of American democracy as well.