TOPICS > Politics

Concerns Intensify on Contractors in Afghanistan

September 4, 2009 at 1:50 PM EDT
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Just as the American embassy in Kabul announced the firing of eight private security guards for misconduct, an investigation has begun to determine whether money received by some contractors was funneled to the Taliban. GlobalPost's Charles Sennott offers insight.

JIM LEHRER: And, in Kabul, the U.S. Embassy announced the firing of eight private security guards. Also replaced was the entire management team of the private contractor hired to protect the embassy. Earlier this week, photos surfaced showing some guards engaging in drunken and lewd behavior. But other troubles are coming to light involving contractors hired by the U.S. to build that country’s infrastructure. Margaret Warner has part three of our Afghan report tonight.

MARGARET WARNER: How does the Taliban fund its operations in Afghanistan? Part of the money may come from the hundreds of millions of dollars the U.S. Agency for International Development, or AID, pays to private contractors for building projects there. AID’s inspector general has opened a probe into whether some of that money is actually going to the Taliban in what amounts to a massive protection racket.

The online news organization GlobalPost has been reporting the story. And we get more from GlobalPost executive editor Charles Sennott. And, Charlie, welcome.

CHARLES SENNOTT, executive editor and vice president, GlobalPost: Thank you. MARGARET WARNER: Tell us, how does this protection racket work?

CHARLES SENNOTT: Well, it is a very troubling story that was uncovered by our correspondent Jean MacKenzie. And what Jean found in reporting in the southeast of the country, the north, and in Kabul is that there is essentially a protection racket. What the Taliban does in the areas where it has control is, they shake down the local contractors, and particularly subcontractors, to try to get a percentage of the contracts they’re getting from USAID or the other international donors.

This is a lot of money. You know, the USAID sends a billion dollars a year on average into Afghanistan. These are large sums of money. And what Jean was finding from contractors was, they build in a 20 percent cost out to the Taliban for shaking them down. So, these — these are large sums of money.

MARGARET WARNER: Now, as I understand it, AID usually awards contracts to U.S. contractors, who, then, in turn, hire local subs. Who is actually making the payments? CHARLES SENNOTT: That’s correct.

MARGARET WARNER: Are — is it the Afghan subs, or are — are there cases — did she find there were cases where the U.S. contractors themselves are doing it?

CHARLES SENNOTT: We mostly found subcontractors. We did not find an on-the-record example of an American contractor, a name that we would know, directly paying the Taliban. Much more likely scenario, the one that Jean established in her reporting, were Afghan subcontractors working for the American firms. But, if you follow the money, if you follow U.S. American taxpayers’ dollars, they go from USAID to the contracts, through the American NGOs, down to the subcontractor level, and then to the Taliban. This is so organized, we found in this reporting at GlobalPost, that they even have an office. The Taliban has an actual contracts office in downtown Kabul. And it — it’s opening — it’s operating fairly openly, which is — is — really adds to the outrage of this.

MARGARET WARNER: Nobody ever said they weren’t good businessmen, as we see the way they run the drug business.


Culture of payoffs

MARGARET WARNER: Now, in other parts of the country, similar payoffs are made, are they not, only it's to local warlords. In other words, wherever you operate in Afghanistan, someone gets paid off for protection?

CHARLES SENNOTT: That's right. And I think one of the questions in those other areas is, typically, those warlords have been our allies. So, you are right. This is a process, a country where payoffs are common. They're part of the history of that land. But this is a point where these are -- these are dollar figures, these are protection rackets actually going to fund the enemy. And that is -- that is something to be, I think, quite concerned about. And we were very pleased to see that the USAID is going to investigate. They have started a probe. And Congress, the Foreign Affairs Committee, is going to hold hearings based on the story that we reported.

MARGARET WARNER: Now, was your reporter -- how close was she able to get to this story? In other words, did she ever talk to actual firm managers who acknowledged that they have to pay this money and described what happens if they don't?

CHARLES SENNOTT: She did. And she describes that in our reporting. Now, it's very difficult to do the standard kind of reporting that we would do here in the United States in Afghanistan. People are risking their lives to tell this story. But she did manage to get to contractors, subcontractors, who talked exactly about how this worked and how they build these costs in. She also got U.S. Embassy officials who spoke on background to talk about how this is a very commonly known reality.

As Jean pointed out in her lead, this is an open secret in Afghanistan. And one of the things we have looked at in our reporting here is to say, the U.S. State Department, USAID, is very removed from the community. They're not there on the ground. They don't have what we call ground truth. Jean MacKenzie, a great reporter, has ground truth. She knows the community. She knows the people. And she heard about this, found it outrageous, and began to do several months of reporting that led to this report on the funding of the Taliban, which occurred within a greater context of a special report we did. But you have to be there on the ground to know that. And the U.S. State Department suffers in not being able to get out of the air-conditioned offices, past the barbed wire, and really talk to people and find out what's going on.

Embassy's response

MARGARET WARNER: But you did say that the embassy officials acknowledged they knew this was going on. What did they say about whatever efforts they had made to try to stop it, if any?

CHARLES SENNOTT: Well, I think that it's very difficult to stop. And, you know, they say they know about it. But they don't know the people who are actually suffering and live in fear, the contractors in the field who are paying this out. They have heard about it. But what we -- what we find -- what I mean by the ground truth is to go out and really talk with those people. And that's what we were able to do.

They do raise a very good point at USAID, which -- which is, thankfully, doing an investigation into this. And I think they should be applauded for that, for at least trying to -- to look into this. It's not going to be easy, because people are afraid. So, it's going to be very hard to get that information.

MARGARET WARNER: Well, the other question this raises -- and I know it's beyond the ken of your reporter in the field -- but is, what's the alternative? If the local police in most parts of Afghanistan are corrupt and/or inept, who protects these projects from insurgents or criminals who otherwise would blow them up?

Taliban funding

CHARLES SENNOTT: Yes, I mean, you know, that's a fair question. But one thing we don't want to do is become a revenue stream for the Taliban. And that's what we're really hearing is happening.

Poppy has had a bad year in Afghanistan, for many reasons, one of them being interdiction has been somewhat successful. So, we know that the poppy crop is down. We know that the Taliban is relying much less on poppy to fund its operations. The Taliban on both sides of the border, Afghanistan and Pakistan, is estimated to have $300 million a year. It used to be pretty much commonly understood that the bulk of that, almost all of that, came from poppy. Now less than half of that funding comes from poppy. So, they have definitely developed alternative streams of revenue.

And this shakedown racket, or protection money, or Islamic tax, as the Taliban would call it, is definitely a revenue stream they have pursued. And if the U.S. government's going to be successful in what it wants to accomplish, if the international community is going to be successful, they're going to have to treat the Taliban like organized crime, which is what it is, and go after the money.

MARGARET WARNER: And then that suggests that they are going to have to find some other way to protect these projects.

CHARLES SENNOTT: I think so. I mean, I think this is part of the larger debate about whether or not to have more troops there.


CHARLES SENNOTT: You know, right now, there's a call for more troops because they need to protect that population to be able to build the roads, build the bridges. So, for sure, this is all part of a much larger debate.

MARGARET WARNER: All right, Charlie, we have to leave it there. Thank you so much.


JIM LEHRER: Charlie Sennott talks about GlobalPost and journalism in the digital world on our Web site at