Prometheus 6

The DNI itself has voiced doubts about the efficiency and effectiveness of outsourcing. In a public report released last fall, the agency said the intelligence community increasingly "finds itself in competition with its contractors for our own employees." Faced with arbitrary staffing limits and uncertain funding, the report said, intelligence agencies are forced "to use contractors for work that may be borderline 'inherently governmental'" -- meaning the agencies have no clear idea about what work should remain exclusively inside the government versus work that can be done by civilians working for private firms. The DNI also found that "those same contractors recruit our own employees, already cleared and trained at government expense, and then 'lease' them back to us at considerably greater expense."

The corporate takeover of U.S. intelligence
The U.S. government now outsources a vast portion of its spying operations to private firms -- with zero public accountability.
By Tim Shorrock

Jun. 01, 2007 | More than five years into the global "war on terror," spying has become one of the fastest-growing private industries in the United States. The federal government relies more than ever on outsourcing for some of its most sensitive work, though it has kept details about its use of private contractors a closely guarded secret. Intelligence experts, and even the government itself, have warned of a critical lack of oversight for the booming intelligence business.

On May 14, at an industry conference in Colorado sponsored by the Defense Intelligence Agency, the U.S. government revealed for the first time how much of its classified intelligence budget is spent on private contracts: a whopping 70 percent. Based on this year’s estimated budget of at least $48 billion, that would come to at least $34 billion in contracts. The figure was disclosed by Terri Everett, a senior procurement executive in the Office of the Director of National Intelligence, the agency established by Congress in 2004 to oversee the 16 agencies that make up the U.S. intelligence infrastructure. A copy of Everett's unclassified PowerPoint slide presentation, titled "Procuring the Future" and dated May 25, was obtained by Salon. (It has since become available on the DIA's Web site.) "We can't spy ... If we can't buy!" one of the slides proclaims, underscoring the enormous dependence of U.S. intelligence agencies on private sector contracts.

The DNI figures show that the aggregate number of private contracts awarded by intelligence agencies rose by about 38 percent from the mid-1990s to 2005. But the surge in outsourcing has been far more dramatic measured in dollars: Over the same period of time, the total value of intelligence contracts more than doubled, from about $18 billion in 1995 to about $42 billion in 2005.

"Those numbers are startling," said Steven Aftergood, the director of the Project on Government Secrecy at the Federation of American Scientists and an expert on the U.S. intelligence budget. "They represent a transformation of the Cold War intelligence bureaucracy into something new and different that is literally dominated by contractor interests."