Left behind in Iraq: thousands of contractors

With the removal of all U.S. troops from Iraq by the end of the year looking more likely, absent an agreement to extend legal immunity, a large contingent of U.S. contractors will still remain facing their own legal and logistical ambiguities and challenges.

The complexity of the situation is not lost on top officials at the State Department who are busy preparing to assume control of every U.S. responsibility in Iraq – including contracting operations.

"The State Department is doing something that quite frankly we have never done before, this is not going to be easy and I think we all understand that," Deputy Secretary of State Thomas Nides told CNN.

"We owe it to the families (who have lost loved ones in Iraq), and to the taxpayers to get this transition done correctly," he added.

For years, thousands of civilian contractors have worked in Iraq operating in a variety of military and support functions. But they have always lacked the same criminal immunity from Iraqi laws that the U.S. military enjoys under existing agreements between the two countries. And for the most part, they operated under the purview of the Defense Department.

While contractors would be subject to the Iraqi criminal justice system as they always have, ambiguities will still exist as to how they would also be held accountable under U.S. law if a situation similar to the 2007 incident involving contractors working for Blackwater (now operating as Xe Services) were to occur.

The issues surrounding their presence in Iraq are likely to become only more complex when U.S. troops do pull out and leave the oversight of the entire contracting force to the U.S. Embassy in Baghdad.

"What the State Department does is diplomacy, and you're going to have the State Department managing contractors that are going to be flying helicopters, driving MRAP's, medevac-ing wounded personnel," Richard Fontaine, and expert on contracting issues with the Center for a New American Security, told CNN.

"This is the kind of thing that the State Department has very little in-house experience in managing," he said.

With a large staff devoted to auditing and providing mechanisms for the oversight of contractors, the Pentagon has a long history of managing a workforce separate from that of the military. "This is a huge leap into the unknown and nobody knows how this is going to turn out, but there is certainly cause for worry," Fontaine said.

Those concerns were echoed by the CEO of a large contracting firm that has operated in both Iraq in Afghanistan, who spoke with CNN but asked not to be identified due to the sensitivity of the subject. With the absence of regional operation centers run by the U.S. military, that were specifically responsible for collecting intelligence about emerging threats across Iraq, this contracting executive warned of a possible "void of information" that could lead to a more dangerous environment for contractors.

Contractors already operating in Iraq who have established relationships with the local populace may feel more comfortable operating there the executive said, adding that the threshold for risk varies by company. Prospective contracting companies may be "less interested" in setting up business in Iraq without the protection of the U.S. military, if they have done so in the past, he said.

That may be, but contract employees in Iraq will be operating under a completely different paradigm according to the State Department. "We are not the military," Nides said. "The mission is different, our objectives are different," and the United States mission will shift to one focused on maintaining and building a diplomatic relationship with Iraq.

In reality, only a small fraction of the contractors in Iraq after U.S. troops leave will operate as armed personnel protecting U.S. diplomats. The vast majority will work as trainers for the Iraqi police and military force, as advisers to Iraqi government ministries, or on development projects across the country that State Department or USAID personnel cannot staff.

Once the U.S. military presence in Iraq is gone, the embassy in Baghdad, the largest U.S. embassy in the world, will be staffed by approximately 1,700 diplomats and representatives of various cabinet agencies. They will be supported by approximately 5,000 security contractors. There will also be up to 4,000 contractors supporting every service for U.S. personnel in Iraq from food to sanitation and anything else necessary for diplomats to carry out their jobs.

Over time, the State Department will look to add local staff in Iraq on a large level at the embassy thereby reducing the numbers of contractors needed Nides said.

In recent months, the State Department began adding staff to prepare for assuming oversight of the contractor workforce in Iraq once the military has pulled out. "The good news is that we've got some really strong management people," that have been added to the embassy staff to plan for all sorts of contingencies with contracting options once the military presence is gone, Nides said. "We think we are in pretty good shape, but there is no question" it will be challenging to get everything right, he said.

With a complete removal of U.S. forces, some also worry diplomat mobility around the country may be constrained with a much smaller number of contractor personnel available to protect diplomats. Nides dismisses that notion saying that U.S. diplomats have been moving around Iraq for years largely without U.S. military escort, relying on contractors when necessary. That situation will continue he says after the military pulls out.

Iraqis "want to get to something defined as normal," with a developed economy and prosperous society for their families, Nides said. It will be important to have civilian contractors in place in the beginning stages at least, to assist U.S. diplomats in helping Iraqis realize that goal, he said.