Sep

14

Private military contractors are war zone speculators and the new book from Robert Young Pelton gives an enjoyable glimpse into the history, formation and daily activities of these contractor companies.

Licensed to Kill does not go too deep and bore the reader but rather makes the most of Pelton's vast contacts and personal stories from operating in various war zones. His balanced writings give him access to the major players in the industry which allows him coverage that other writers cannot match.

The book opens up with an email which was circulated amongst contractors that summarizes their outlook and reasoning for such a job.

One investment theme that I continue to pursue is the government contracting out of infrastructure to private companies, and I felt the book was a great insight into the beneficiaries in global security infrastructure. Countless examples are given of the military being replaced for non offensive duties by fewer and more highly skilled contractors in a trend that gains momentum.

An important theme throughout the book is the difference between a mercenary operation and security contractors. The line is occasionally blurred but the greatest distinction is that mercenaries conduct offensive duties and security contractors only act defensively. Discussed in this regard are the Sandline affair and the failed coup attempt in Equatorial Guinea by former Executive Outcomes personnel

A few of the contractor companies mentioned in the book are Blackwater USA, Triple Canopy, and SCG International. Some offer interesting emails which update and assess the security situation around the globe as well. I am a big fan of anything Pelton puts out and if anyone has further interest in his works you can check his webpage.

Peacekeeping is a growth area for the contractors, and the President of Blackwater states in the book that, "We are going to field a brigade-sized peacekeeping force. You can quote me on that."

For instance in regards to Darfur, Blackwater's President elaborates that, "We are turning a CASA 212 into a gunship that would cruise around at thirty-eight degrees…and when we find the bad guys, we would lay into them." The Director of Business Development then followed up to say, "Yeah, Janjaweed be gone!"

One effect of market forces upon the contractors is the cost of an armored drive from Baghdad's Airport to the Green Zone along Route Irish. Pelton reported in July that the price of an airport run is as low as $1500, down from upwards of $20,000….but this is one expense not to skimp on! Perhaps the run is simply getting safer but I imagine that competition plays the largest part in the price drop.

In regard to everchanging cycles, it is also noted that suicide bombers would approach the convoy initially from the rear until the convoy gunners learned and would shoot anything that came close. To adjust, the bombers would slow down from the front and when that failed to consistently work, they began to drive from the opposite direction and over the median into the convoy. All that in addition to roadside IEDs makes for a lot of uncertainty.

Also, a useful technique that Pelton observed during training for new contractors at Blackwater was the role reversal where the trainees would act as terrorists assaulting a convoy and the instructors would act as the convoy. This enabled the trainees to get into the mind of their enemy and probe for weak spots which were fully exploited. In the markets, how many price takers fully understand how price makers operate? Very few in my opinion.

Yishen Kuik adds:

Oddly enough, all of the points in Mr. Carlson's post are directly applicable to aficionados of team based first person shooting PC games like Day of Defeat. Someone who has played the Axis team on a given map becomes much more effective when playing the Allied team. Hiding spots, ambush points become clearer.

On changing cycles — an Axis sniper in a church tower can rack up kills, but will also eventually draw enemy fire. A skilled player knows when to move on to the next spot, for soon the tower will be strafed with machine gun fire and rockets. This also has parallels to fixed systems. The market will adapt and take you out.

When such an ambush point becomes 'hot', enemy forces will continue to deliver precautionary fire on it, regardless of whether anyone is there or not. It then becomes a very dangerous spot to be near - this is the trough of the cycle.

However, again very much like markets, if the church tower is left unoccupied for a long enough time, the enemy's wariness of it slowly diminishes, and the skilled sniper knows when the time is right to re-occupy it.

In fact, very good players make it a point to cycle between ambush points, leaving just before the previous point draws fire, moving onto a new point and then returning to the old point once it "cools" down.

First person team shooters are a wonderful laboratory of group dynamics. I've seen the above cycles again and again over hundreds of games.

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