The economics of mercenaries: the cost of war is rising

Dispatches From Fallujah - Why would anyone volunteer to be an infantryman? By Owen West

Paying civilians to play soldier makes no sense. Today the United States employs between 7,000 and 17,000 civilians in infantry roles. The pay is extraordinary, hovering between $500 per day and $1,000 per day for everything from site security (for government compounds throughout Iraq) to convoy/company security to personal security (for dignitaries). This money comes tax-free in a combat zone. There are four problems here: morale deflation, gross monetary waste, tactical confusion, and direct competition for a tiny talent pool.

Soldiers look at security contractors and think: Why the hell is he making eight times my salary for performing the same job? Is the military that pock-marked with overage and inefficiency? Using bottom-up cost-accounting, the military is essentially buying out its most experienced soldiers and luring them out of the active ranks (if Stop-Loss is ever lifted, that is) with rich contracts, even as it desperately seeks new recruits. Worse, it's paying introduction fees to private security companies like Dynacorps and Blackwater for the people it recruited in the first place. How in the world did this happen?

The answer may lie in the marginal recruit. Congress just passed legislation to increase the number of soldiers by 30,000. But the Army is just barely meeting its current recruiting goals. To attract these new hires, the Army will have to come up with a pay structure that lures the 30,000th recruit. The problem is, the military pay structure is so antiquated that if you pay one soldier more money, you pay all soldiers more money. So it's not a question of paying 30,000 recruits. It's a question of paying those 30,000, then upping the pay of the other 1.4 million active members and the other 1.1 million reservists. It's an expensive prospect, this reverse Dutch auction. Perhaps it's cheaper to shift 10,000 infantry jobs over to the privateers, jack up the pay of private contractors, and pay the brokerage fee to the company.

This conclusion still omits the inherent problems created when armed civilians operate in a battlefield controlled by the military. The Blackwater security crew that was ambushed in Fallujah was operating in the Marine Corps zone without their knowledge and specific consent. As a result, Marine plans to systematically build up goodwill in the Sunni Triangle were scrapped. In Abu Ghraib, contractors held sway over soldiers, yet took no responsibility in the aftermath. In sum, contractors operating outside the chain of command clashes with common sense.

This is not to denigrate contractors themselves—they are experienced soldiers who have been there and done that. Which is precisely why we need to keep them in the Army. Less than one-tenth of 1 percent of the U.S. population chooses to become an infantryman. It is a profession—a public expression of commitment—rather than a job. This is a tiny talent pool. We need everyone who heeds the call to carry a rifle working toward a common goal, and the best way to do that is to keep these folks in the government.

How, then, should these elite infantrymen be compensated so that we can attract and retain the best? By revamping the military pay structure. Today the 9-to-5 corporal disbursing pay on some base in Florida earns the same salary as the corporal working 20 hours a day who is on his third deployment in three months. As for elite infantrymen, who we need for special security in war zones, offer them the same pay structure we give today's contractors and then take a look at re-enlistment rates. They'll skyrocket. What's more, the military will pay no brokerage fees and will retain the flexibility to reassign these men as the battlefield shifts. The military needs an escalating, bonus-based pay system that coincides with performance and hardship, not rank and time-in-grade."

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I'd been impressed by the arguments for the fairness of the draft, but Kaplan convinced me a draft would be extraorinarily ineffective. He and Owens agree -- the answer is a LOT more money for active fighters.