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Authors: Nathan Hodge

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Civil Affairs had not, however, been conceived of as the primary development arm of the U.S. government. Its units were there to serve the immediate needs of the military commander on the scene; they were not equipped for any kind of long-term development effort. The idea was to step in, stabilize the situation, and get out. Patching up a road that was torn up by tank treads was one thing; helping create sustainable livelihoods in agricultural communities was quite another.

That was a job for another set of newcomers to the Shomali Plain: contractors from the U.S. Agency for International Development, or USAID. In July 2002, USAID awarded Chemonics International, a for-profit development firm, a $2.9 million contract for the Quick Impact Project, a short-term effort to repair the roads and the irrigation canals that once were the economic lifeline of the Shomali. The Quick Impact project was supposed to provide a quick infusion of jobs for returning families, and Chemonics hired three thousand local men to work as unskilled laborers rebuilding roads. The project would inject cash into the local economy, and help create the basic infrastructure that would connect communities to the capital.
11
The Quick Impact Project was also an important win for Chemonics: In 2000, its USAID contracts totaled $6.7 million.
12

Development work and humanitarian aid may once have been the traditional domain of not-for-profit groups, charities, and international aid organizations such as CARE, Save the Children, and Médecins sans Frontières. Some nonprofits worked as “implementation partners” for government-funded aid schemes; others maintained their independence, refusing government funds. But foreign aid was also a tool of foreign policy. And it had increasingly become a for-profit business.

Chemonics was a good example. Founded in 1975 by Thurston Teele, a former Foreign Service officer, Chemonics was one of a number of private companies that had built a formidable business in the 1990s bidding for contracts from the U.S. government's aid agency. As part of an experiment in “reinventing government” led by the Clinton administration, USAID had become the government's primary laboratory for outsourcing.
13
USAID, which had deployed two thousand civilian development experts to South Vietnam at the height of the Vietnam War, had been gutted by a series of staff cutbacks; by 2002 it was basically a glorified contracting organization.
14
By the end of the 1990s, around half of USAID's funds for overseas development assistance were being channeled through private firms; the primary beneficiaries of U.S. development assistance were contractors. Ruben Berrios, a scholar who studied the emergence of for-profit companies in U.S. development assistance in the 1990s, reckoned that only a few cents of every foreign aid dollar actually ever reached the developing world. Hiring for-profit development companies often meant that much foreign aid was repatriated to the United States in the form of consultant salaries and other goods and services provided by contractors.
15

This was the dirty little secret of U.S. foreign development assistance. While summoning visions of altruistic, self-sacrificing aid workers wearing sandals and digging wells, aid was really quite the racket. I had first encountered the world of the high-priced development consultant in the mid- to late 1990s, while living in Ukraine. To my eyes, at least, the life of a USAID contractor in Kyiv seemed to be one of enormous privilege, particularly in the down-at-heel world of post-Soviet Ukraine. Their employers paid astronomical sums to rent out smartly refurbished flats in the center of town; they were ferried around by drivers; they frequented a clutch of per diem–busting restaurants. This cosseted class also had its own unique vocabulary. Much discussion revolved around their “pay differential”—many of them, to my surprise, drew hardship pay—and they tended to ask other Americans how long they had been “in country,” as if they were in the middle of a one-year combat tour. Ukrainians were referred to as “locals” (the word “native,” evidently, had fallen out of fashion), and the USAID consultants had a uniformly low opinion of them. To my astonishment, few of the USAID contractors I met could speak passable Russian or Ukrainian. This, for them, was another stop on the USAID contracting circuit. Next year they would be in Bolivia, Bangladesh, or Albania.

Ukraine was a dysfunctional state run by retrograde former Communist officials. It had creaky infrastructure and poor rule of law; nevertheless, in most respects it belonged to the developed world. Still, like the rest of Eastern Europe and the former Soviet Union, Ukraine was a boom market for private-sector foreign aid contractors such as Chemonics and Booz Allen Hamilton as well as for large, not-for-profit entities like Counterpart International and International Relief and Development. They won USAID contracts to advise the Ukrainians on everything from agricultural-sector reform to media development.
16

In the mid-1990s, Matt Bivens, a young freelance journalist, received a lucrative offer from Burson-Marsteller, a U.S. public relations firm, to work on a USAID contract promoting privatization in Kazakhstan. Burson-Marsteller, he later wrote, “made me an offer I couldn't refuse: $53,518 a year after taxes, insurance benefits, free housing, a driver, a maid, a $2,000 moving allowance, and an additional $25 per diem ($9,000 a year) in spending money. All told, a $70,000-a-year package; after only a few months, it would grow to $90,000.”
17

Bivens was twenty-six years old. In a scathing 1997 article in
Harper's
, he described the daily routine of a “cost-plus” USAID contractor in Kazakhstan. “The main event of every day was lunch,” he wrote.

Lunch was always at a fancy restaurant, with your driver waiting out front. More than thirty-five U.S. companies or organizations were on the AID payroll in Kazakhstan, offering advice on everything from drafting laws to wearing condoms, and every single one of them seemed to be as high on lunch as Burson-Marsteller was … Fridays I would retrieve a crumpled ball of business cards from my suit-coat pocket and incorporate them into a memo summarizing my work week: Monday met with so-and-so, discussed such-and-such. Tuesday met with such-and-such of the this-and-that group. Mostly I was describing lunch.
18

Foreign aid budgets were often singled out by conservatives as a waste of taxpayer money—and aid programs to Eastern Europe and the former Soviet Union in the 1990s set new standards for corruption and mismanagement. In Russia, USAID hired the Harvard Institute for International Development to advise the government on privatization. The project was directed by Andrei Shleifer, a Russian-born émigré and tenured professor of economics at Harvard; another consultant to the project was Jonathan Hay, a Rhodes Scholar and former World Bank consultant. Both men, it turned out, had a massive conflict of interest: While helping the Russian government design the rules for a market economy, they were simultaneously making personal investments in Russia.
19
The U.S. government later implicated both men in a conspiracy to defraud the government, and Harvard University eventually paid $26.5 million to the U.S. government to settle a lawsuit after a U.S. District Court judge found Shleifer and Hay liable for breaching conflict-of-interest rules. Neither Shleifer nor Hay acknowledged any wrongdoing.
20

Afghanistan would be the next big market for the USAID contractors. Much as KBR had arrived to scout Bagram Air Base for business opportunities with the Army, companies such as Chemonics, Bearing Point, and Louis Berger Group were positioning themselves to snag more contracts in Afghanistan. After all, USAID was as dependent upon companies like Chemonics to do its work as the Army was dependent on LOGCAP contracts to maintain its bases overseas. In government contracting parlance, Chemonics had a “track record”—it could be counted on to present a bid that would meet the Byzantine requirements of government contracting practice. As Joel Hafvenstein, a young Chemonics consultant, would note in his memoir of the aid business in Afghanistan, “Chemonics was nothing if not a proposal-writing machine. The company prided itself on being able to whip up a plan and a team to carry out pretty much anything USAID might want to do: clean up air pollution in Cairo, train Russian judges, help Ugandans export cut flowers.”
21

By the time Hafvenstein arrived to help close out the Chemonics Quick Impact Project on the Shomali Plain, a micro-economy had already sprung up in Kabul that served a small community of international relief workers and aid contractors, conspicuous in their white SUVs. Their drivers would park their vehicles outside the discreet restaurants that catered to Kabul's expatriate community, small oases behind compound walls where the development set could chill out, drink a few cans of imported Heineken, and live some facsimile of the high life.

At that point it was not clear what USAID's long-term plan for rebuilding Afghanistan was, or what the end-state was supposed to be. But the reconstruction of Afghanistan meant there would be a new destination for the lavishly paid class of aid consultants who would see Afghans through the windshields of their air-conditioned Land Cruisers. Watching the arrival of Development Inc. in Kabul, I wondered if this would be a new chance to get foreign aid right—or another opportunity for waste, fraud, and abuse.

For the time being, Afghanistan remained primarily a military mission. And Operation Enduring Freedom, the military's name for the post–September 11 campaign in Afghanistan, was first and foremost a punitive expedition. Major Bryan Hilferty, the spokesman for the Army's Tenth Mountain Division at Bagram, would conclude all of his press briefings with the same sound bite: “The hunt continues. The war against al-Qaeda in Afghanistan is not over.”

After Operation Anaconda was wrapped up, in late March 2002, the press corps at Bagram rapidly dwindled: The dramatic battle in the mountains was over, and few reporters were attracted to the less alluring subject of rebuilding Afghanistan's shattered infrastructure. For the news media as much as the military, Afghanistan's long-term economic development was an afterthought.

Afghanistan had a transitional administration headed by Hamid Karzai, but little else that resembled a functioning national government or bureaucracy. The State Department needed the rudiments of a functioning embassy, both to conduct diplomatic business with the new government and to help get it on its feet. In March 2002, Ambassador Robert Finn, a career diplomat with some experience in the region, was dispatched to Kabul to set up an embassy. Finn had helped open the first U.S. diplomatic mission in the oil-rich former Soviet republic of Azerbaijan, and had previously served as ambassador to Tajikistan, the dysfunctional Central Asian state that bordered northern Afghanistan. At the time, the State Department had yet to begin normal rotational staffing for diplomats to Afghanistan. Kabul was considered a “hardship” rotation; most officers would stay for only weeks at a time. The high turnover meant there was constant waste and duplication of effort. There was no institutional memory to guide aid effectively.

Keith Mines was one of the Foreign Service officers who volunteered to “go TDY” (on temporary duty) to help get the embassy up and running. He arrived in Kabul in June 2002. The U.S. embassy in Kabul occupied a sandbagged compound near a traffic circle recently renamed for the martyred Northern Alliance commander, Ahmad Shah Massoud. After the city fell to the Northern Alliance in late 2001, a team of CIA and U.S. Special Operations commandos made their way through downtown Kabul to reclaim the embassy, which had been shuttered during Afghanistan's civil war and the years of Taliban rule. Gary Berntsen, a counterterrorism officer, was one of the first Americans to set foot in the embassy since 1989; he found rotary-dial telephones and official photographs of President Ronald Reagan and Vice President George H. W. Bush on the wall. On the floor of the ambassador's office Berntsen found a more somber memento: a photograph from the funeral of Adolph Dubs, the last U.S. ambassador to Afghanistan, who was killed in an exchange of fire during a botched hostage rescue attempt at a Kabul hotel in 1979.
22

Among the many bureaucratic tribes in Washington, the Foreign Service had always conceived of itself as something of an elite. Foreign Service officers had to pass competitive entry exams, a written test and a more subjectively graded oral exam; obtain Top Secret security clearances; and pass a “suitability review.” Foreign Service officers segregated themselves from the other civil servants within the State Department. FSOs, as they are called, are diplomats, not ordinary bureaucrats; everyone else is mere support staff, regardless of their pay grade or their expertise. Even the analysts at the Bureau of Intelligence and Research, the State Department's respected intelligence arm, were second-class citizens within the department. Until Colin Powell became secretary of state under George W. Bush, Foreign Service officers even had their own dedicated lounge inside “main State,” the State Department's headquarters in Foggy Bottom.

Some Foreign Service officers were attracted to the job's prestige, and to the postings in European capitals. Mines was not one of them. He was the kind of Foreign Service officer instinctively drawn to what he called the “failed-state circuit.” As a diplomat, he had served tours in Somalia and Haiti; he had made friends with Palestinians during a posting to Israel; and he had spent time overseas outside the protective embrace of the embassy. In the late 1970s, he had spent two years as a young Mormon missionary in Colombia, which was emerging from two decades of mayhem known as
la violencia
. His first experience was working in Barranquilla with a Colombian companion who spoke no English. He would go for weeks on end without any contact with other Americans.

Colombia taught him some valuable lessons. “That was the closest I have ever been to a foreign culture, living as we did directly among the people without any of the organizational protection from things foreign that is provided in military or Embassy service, business or even the Peace Corps,” he later recalled.
*
That familiarity with life outside the embassy walls set Mines apart, as did his previous career: Before joining the Foreign Service, Mines was an Army infantry officer.

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