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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (176162)	11/29/2005 8:46:24 AM
From: Hawkmoon	Respond to of 281500

No.. I hadn't heard about it.. But I have to believe that there must have been something other than despair over alleged war profiteering that resulted in his ventilating his skull. There has been war profiteering in EVERY conflict. Hell, there was serious WP during the Civil War where shoddy products were being provided to soldiers.. It's DISGUSTING!! Let me explain something about how I understand some contracts (probably not all) are written here. A US company is given a statement of work, often expansive, the requires them to perform a service. They are often obligated to hire local sub-contractors to perform that work. And because most of the US contractors are "sole source", or "cost +" contracts, the contracting company is generally relegated to a specific profit margin on services rendered.. For example, in the states, I was once a business development specialist for a security guard company. Our profit margin on guard contracts was generally limited to 5% above cost (there were other "weasle ways" to eek out additional profit). So when we competed with other companies that had more resources, we generally had to find a way to minimize expenses AFTER the contract was awarded to us according to our bid price if we wanted to generate additional profit. (of course, this often meant failing to "fully" implement the statement of work to its totality, hoping the government didn't catch the impropriety.. which I had NOTHING to do with since that was "operations", not BD, btw.. In Iraq.. there are big US companies that are ALSO limited to the amount of profit they can extract from a contract. If, for example, they are relegated to 10% profit margin based on billed services, then they have NO INTEREST in hiring a lost cost sub-contractor. Because 10% profit on more expensive sub-contracting costs is better than 10% profit on a competively bidded sub-contractor process... For example.. Sand Bags.. (my pet peeve).. A US contractor was ordered to obtain 100,000 sand bags for force protection purposes. That contractor went out and hired an Iraqi sub-contractor to deliver those bags for $100,000. Now you and I know that the average Iraqi sand bag filler is being paid $10-15/day TOPS.. And he can fill a hell of a lot of sand bags in an average 8 hour period. But rather than competively bidding out the sand bag contract to the lowest bidder, or even middle cost sub, the US contractor takes the highest prices sub-contractor that they justify (based on past performance, background security checks.. etc).. So that US contractor is going to make 10% profit based upon that $100,000 contract, despite the fact that paying $1/bag can only be called "war profiteering". But no one is going to complain because were these bags filled and delivered in the higher cost US, that's about what they would cost using US labor.. There simply little incentive for US contractors in Iraq to keep costs down. And little competition.. We've been in Iraq for several years now.. It's probably time that the US government be a bit more picky about how it obtains services. And it's certainly high time that there are more governmental reviews of sub-contracts obtained to provide services in Iraq. We're creating inflation, and a vast re-distribution of wealth to the sub-contractors, to the detriment of the laborers. Btw, in the US, we use something called a "wage determination" when judging what labor should cost for a governmental contract. It's the minimum that a company can pay its employees. I suggest something similar is LONG overdue with regard to Iraqi sub-contractors receiving US contracts. I would rather the benefit of US spending go into the pockets of the average Iraqi laborer, than in the pockets of an Iraqi war profiteer.. Does that explanation makes sense? Hawk