Rise of the Native National Security Corporation

Native American corporations, led by dozens from Alaska, are coming under fire in Congress for their preferential access to billions of dollars in defense, intelligence, and homeland security contracts – and because of the often shoddy, largely unaccountable work on national security and homeland security contracts.

Another related concern is that these preferential contracts – granted without the normal open bidding process – are actually performed by other corporations who receive subcontracts from the Native American corporation, which functions largely as a vehicle to secure contracts, not implement them.

Two of the main critics of the Alaska Native Corporations (ANCs) that have captured major national security contracts are Sen. Claire McCaskill (D-Mo.) and former senator and current Secretary of State Hillary Clinton. ANCs were created in the wake of the Alaska Claims Settlement Act of 1971.

Since 2000 ANCs have captured large military and homeland security contracts even though these corporations have only minimal in-house experience in the much of their contracted jobs. The Chenega Corporation, which partners with the infamous Blackwater (recently renamed Xe Services), lists the “strengths and services” of its “Intel and Military Operations” on its corporate website:

• Transformation and future force development

• Support to Intel and special operations

• Operational readiness, asymmetric warfare and C4ISR support

• Weapons system engineering and logistics

• Operational analysis, concept of operations development

• Linguistics, debriefers, and translation services

Two federal initiatives – one by the Small Business Administration and the other by the contracting oversight committee of the Senate Homeland Security Committee – are investigating the pillaging of federal defense and homeland security contracts by ANCs and their subcontractors. But neither the efforts of the SBA to reform its own contracting regulations nor the work of Senator McCaskill’s subcommittee have gained much media attention or public support – in part because of the esoteric nature of these preferential contracts and in part because of the power of the national security industry that has benefited by partnering with ANCs.


Overview of the Alaska Native National Security Bonanza 

Contract awards to ANCs increased by 916% from 2000-2008, rising from $508.4 million in 2000 to $5.2 billion in 2008. A sharply declining percentage of ANC contracts are performed in Alaska. In 2008 approximately 80% of the contract dollars went for work outside Alaska – with Virginia being the leading state for ANC operations

The first volume of a two-part report recently prepared for the Senate Committee on Homeland Security and Governmental Affairs for Senator McCaskill found that ANC federal contracts have been increasing at a 33.6% annual rate since 2000 – six times greater than the overall increase in federal contract spending.

The value of federal contracts did rose rapidly during the Bush administration – up $149% in eight years – but the dollar amount of ANC contracts jumped more than 900%.

Despite their being multimillion corporations, the ANCs still depend on their officially designated status as small businesses to rake in billions of dollars in preferential federal contracts. ANCs receive a disproportionate share of 8(a) or federal small business contracts. Between 2000 and 2008, ANCs received $12.1 billion in federal contracts through the 8(a) program. In 2008, awards to ANCs constituted 18% of all federal contract dollars awarded through 8(a) prime contracts. Also in 2008 nearly three-quarters of all federal contracts were awarded to ANCS under the government’s small business procurement practices.

There are federal regulations that limit the amount awarded in small business contracts. As a rule, sole-source 8(a) contracts must be valued under $5.5 million for goods or $3.5 million for services. That’s not a problem for the ANCs, which are exempt from this restriction because of their special Native Alaskan status. ANCs captured a flood of 8(a) contracts in 2000-2008 valued more than the stated maximum.

 In that eight-year period the federal government issued $6.3 billion in contracts to ANCs like Ahtna, Chugach, ASRC Management Services, and Chenega that far out-stripped the $3.5 million set by the federal government to give preference to small businesses. Generally, sole-source 8(a) contracts must be valued under $5.5 million for goods or $3.5 million for services. ANCs, which are exempt from this restriction, received $6.3 billion in 8(a) contracts valued at more than $3.5 million each between 2000 and 2008.

 Key Findings of the Senate’s Homeland Security

Contracting Oversight Subcommittee T


The key findings (below) of the contracting oversight committee are alarming. They point to widespread and systematic abuse of preferential contracting by the ANCs and their subcontractor partners. 


 • ANCs are now among the largest federal contractors. In 2008 four ANCs – Arctic Slope Regional Corporation, Afognak Native Corporation, NANA Regional Corporation, and Chugach Alaska Corporation – were among the top 100 recipients of federal contract awards. 


• ANCs are big businesses.

The majority of the Alaska Native Corporations surveyed by the Subcommittee exceed the size requirements applicable to other 8(a) companies. 11 out of 19 surveyed companies have had annual revenues higher than the Small Business Administration’s limit since 2002. 


• ANCs have created multiple 8(a) subsidiaries. The ANCs have taken advantage of the exemption from the size requirements to create multiple 8(a) subsidiaries. Over the last 9 years, the 19 companies surveyed by the Subcommittee have enrolled 248 subsidiaries, joint ventures, or partnerships in the 8(a) program. 


• ANCS are awarded multiple large federal contracts on a sole-source basis. Between 2000 and 2008, ANCs received $6.6 billion in 8(a) sole-source contracts valued at more than $3.5 million each. The single largest ANC 8(a) contract is the $1.13 billion Inter-Service Supply Support Operations Program (ISSOP) contract that was awarded by the Defense Department to FSS-Alutiiq, a joint venture of Arctic Slope Regional Corporation and Afognak Native Corporation, in 2002. 


 • ANCS are passing work through to subcontractors. The Afognak Native Corporation can be viewed as a case study of how ANCS create subcontracts to pass work to large, non-Native companies. Nine subcontractors alone received more than 70% of all subcontract awards under Afognak contracts. For 91 individual contracts collectively worth more than $827 million, Afognak paid subcontractors more than 50% of the total prime contract revenue on each contract. 


• ANCs employ a relatively small percentage of shareholders. The 19 Alaska Native Corporations that provided information to the Subcommittee employ more than 45,000 individuals throughout their corporations. Of these, approximately 2,400 employees – 5.2% - are shareholders (or relatives of shareholders) of the employing corporation. On average, nearly 95% of ANC employees are not ANC shareholders. 


 • ANCs have relied heavily on highly-paid, non-Native executives. Of the 13 corporations that provided detailed information to the Subcommittee regarding executive compensation for non-Native executives, 69% of executive compensation was paid to individuals who were not shareholders in the Native Corporations. The information produced to the Subcommittee also shows that for one or more years between 2000 and 2008, eight Alaska Native Corporations paid their Chief Executive Officer, who was a shareholder, substantially less than a non-shareholder holding a lower-ranked position. 


* Little Trickle-Down to ANC Community Members or Shareholders. One of the primary rationales for the ANC contracting preferences is that they provide economic support and other benefits for Native shareholders and communities. The Subcommittee’s investigation shows that the 19 ANCs have provided cash, scholarships, preservation of cultural heritage, or other benefits valued at approximately $720.1 million over the last nine years to members of the Alaska Native community as a result of federal contracts. On average, that amounts to a value of $615 per person per year. 

 Border Security Bonanza Boondoggle

 The awarding of homeland security, defense, and intelligence contracts to ANCs has been on the upswing since the late 1990s but has experienced a major up-tick since 2001 when national security outsourcing has become core to post-Sept. 11 national security and operations.

It’s not that there is a new federal emphasis on doing business with Native America corporations. Rather, it’s simply that there has been a surge in outsourcing as a result of hurried attempts by DOD to keep the Iraq and Afghanistan wars going while the military itself is overstretched, and also as the result of a dramatic surge in homeland security and intelligence contracting.

 From the beginning of this upswing in outsourcing, ANCs have been plied with federal contracts. Some of the most stunning problems with this outsourcing to ANCs have been associated with border security. One of the earliest cases of wasted money and failed projects that came to the attention of government investigators and brought unwanted attention to one of the Democratic Party’s rising stars in intelligence, defense, and homeland security issues – U.S. Rep. Silvestre Reyes (D-Tx.), who represents the El Paso area.

 Like many of the Native American national security contracts, a 1998 Border Patrol contract for border electronic surveillance with Chugach Development Corporation also involved a non-ANC subcontractor, International Microwave Corp. The Integrated Surveillance Intelligence System (ISIS), which was to be deployed along portions of the southern and northern borders, was a predecessor of the Border Patrol’s current SBInet. T

The chief promoter of ISIS, which operated through two successive no-bid contracts, was Rep. Reyes, who served as district Border Patrol chief of the El Paso sector before his election to Congress in 1997. Reyes was closely tied to the project not only through his role in Congress but also through family members who found high-level jobs at Chugach and later ISIS (and still later in the management of L-3 Communications, which bought IMC).

Questions about Reyes' campaign financing and possibly related contracts have surrounded the congressman's persistent and longtime support for high-tech electronic surveillance along the border, involving two no-bid contracts. Since coming to Washington in January 1997 Reyes has been a key advocate of constructing a "virtual fence" along the southwestern border, despite the all-too-real multibillion dollar price tag and absence of hard data that the billions result in improved border security.

Although the oversight problems with ANC contracting – and with border electronic surveillance projects – had existed since the late 1990s with the launching of the ISIS pilot project, it wasn't until the Inspector General (OIG) of the federal government's General Services Administration in December 2004 released an audit of the border electronic surveillance project that some of the details of the electronic surveillance project were publicly revealed.

The audit focused on the Border Patrol's relationship with the two ISIS contractors, starting with the Alaska native-based Chugach Development Corp. (headquartered in Virginia) and continuing with its successor, International Microwave Corp. Rebecca Reyes, daughter of Rep. Reyes, directed the ISIS project for the two contractors.

According to GSA, the audit review of ISIS encountered serious management issues that undermined the value of the more than $200 million that had been spent on the surveillance project.

The GSA inspector general found, among other things, that ISIS suffered from: "lack of competition in the awarding" of the contract, "inappropriate contract for construction services," "inadequate contract administration and project management," "providing equipment without contract approval," and "ineffective management controls."

The GSA inspector general's audit concluded that the government had paid for "shoddy work" or "for work that was incomplete or never delivered." Official inattention to the contracted project "placed taxpayers' dollars and … national security at risk."

Also See:

New National Security Complex:Bringing Together Homeland Security, Intelligence, and Defense

Native Corporations as National Security Corporations

Native American corporations, particularly an array of Alaska Native Corporations, have become major defense and homeland security contractors – responsible for a wide range of national security operations, including electronic surveillance on the border, running immigrant detention centers, and supplying security and other services in U.S. overseas wars and energy exploitation.

Ahtna Inc., one of the thirteen Alaska Native Corporations (ANCs) established in 1971 through the Alaska Native Claims Settlement Act, received an infusion of federal funds in compensation for common lands lost to government and the private sector. Its subsidiary Ahtna Technical Services operates the Varick Street Detention Facility in Greenwich Village under a 2008 contract with Immigration and Customs Enforcement (ICE), which is an agency of the Department of Homeland Security.

Its role at the NYC immigrant detention center was reported recently in a New York Times article by Nina Bernstein. Ahtna is a major federal contractor. In addition to fifteen DHS immigrant-detention related contracts in 2009, the Native American corporation has multiple contracts with the Department of Defense, Department of Energy, and Veterans Affairs.

 Why does a Native American company from distant Alaska, one that was initially capitalized with federal funds, operate an immigrant detention center in the heart of New York? Because the Native Alaskan company specializes in penal services? Because it is intent on reviving the Indian connection with the original Manhattans who sold their island to the Dutch West India Company – and now want a better financial return? Because the federal government, and in particular the Department of Homeland Security, believes that these Alaskan natives deserve favored treatment in securing federal contracts?

 There is no ready answer that explains why Ahtna Technical Services has the ICE contract to manage, operate, and maintain the Varick Street Detention Facility in New York City. Nor is there a good explanation or rationale why Homeland Security has selected Ahtna, which has no experience in correctional services, to provide operational, maintenance, and other support services at two other ICE immigrant detention centers – Buffalo Federal Detention Facility and Krome Service Processing Center in Miami. In addition, ICE has contracted the Alaskan corporation to manage food services at six other ICE processing centers.

 The explanation lies in complex mix of well-intentioned economic development theory, grave historic grievances, modern identity politics and affirmative hiring, preferential contracting, political contrivances, a recent surge in government outsourcing, and ostensibly strict federal contracting requirements that are easily manipulated. Ahtna’s recent entrance into the immigrant incarceration business is but one example of how federal programs and statutes that were created to alleviate Native American poverty and promote development have become badly distorted and misused.

What Does Ahtna Do?

 That’s not easy to determine given the corporation’s own lack of specificity and the variety of its contracts. The simplest thing would be to say, as it does, that it is “A Full-Service Operations and Maintenance Company.”

 Or if you want a slighter more fleshed out description the Ahtna Development Corporation, the umbrella entity that spins out all the Ahtna subsidiaries, asserts that it “possesses the talent, vision and resources to the leader by providing our clients with customized solutions and the technological edge needed to meet their goals and to build partnerships, cultivate talent, invest in resources and integrate services in the marketplace of tomorrow.”

 What is more, Ahtna says it has:

“…positioned itself for future growth, both financially and geographically, by offering clients a strong, balanced, and diverse portfolio of services in both the private and public business arenas. [We are] a multi-disciplinary operations and maintenance (O&M) services company which offers a suite of service capabilities to federal agencies and private sector that are essentially global in nature.”

With respect to its “Business Classifications,” the Ahtna Development Corporation highlights its following four classifications for federal contracts: Alaska Native-owned, Woman-owned, Minority-owned, and Small Disadvantaged Business. Alaska Native Corporations have come under escalating criticism in the last couple of years from congressional oversight committees, governmental investigative bodies, angry competitors, and government watchdogs.

 At the heart of the mounting criticism of Ahtna and other Native American corporations, particularly the ANCs and the numerous Alaska Native Village Corporations, is the breakdown and abuse of federal contracting. Preferences are given to these Native American corporations in federal procurement as part of an affirmative action social and economic policy framework that was intended to offer economic development opportunities to impoverished, disadvantaged communities.

 But the preferences have functioned as shields to deflect competition, to gain access to no-bid contracts, and to pass the bounty of federal defense, homeland security, energy, and services contracts to non-Native partners. Nine of the top ten federal contractors based in Alaska were ANCs in 2009. Chugach Alaska Corporation, the top ANC federal contractor, won $496.7 million in federal contracts in 2009, according to preliminary estimates. Ahtna Inc. was sixth with $86.9 million.

Top 10 Federal Contractors in Alaska, 2009

Chugach Alaska Corporation $496,679,772
Nana Regional Corporation, Inc. $294,486,882
Afognak Native Corporation $207,556,969
Arctic Slope Regional Corporation $195,743,314
Inuit-Nci JV $90,490,505
Ahtna, Incorporated $86,865,509 
Watterson Construction Company $80,786,703
Suulutaaq/Sloan Fencing JV $73,496,604
The Kuskokwim Corporation $68,961,125
Ukpeagvik Inupiat Corporation $63,486,802

Source: USASpending.gov

Through skillful political intervention and corporate maneuvering, the ANCs began to develop a higher profile in the late 1990s and blossomed this decade as national security corporations. More than 70% of ANC contracts in 2000-2008 came from the Department of Defense. From 2000 to 2008 DOD had $16.9 billion in contracts with Alaska Native Corporations. Next largest federal contractor was the Department of Interior with $1 billion in ANC contracts, followed by the Department of Homeland Security with $980 million in ANC contracts in the same period.

Next: Rise of the Native National Security Corporation Also see: New National Security Complex: Bringing Together Homeland Security, Intelligence, and Defense 

Native Americans Profit from Abusive Immigrant Detention and Billions of Dollars in National Security Contracts

(Another article in the continuing Border Lines series on the Homeland Security Complex and National Security Contracting.) 


The New York Times had another horror story about immigrant detention, another in a impressive string of investigative articles by NYT’s Nina Bernstein that have underscored the federal government’s lack of oversight and abusive treatment of legal and illegal immigrants. 

Such stories – about deaths and suicides in immigrant prisons, huge profits in immigrant inmate outsourcing, and the tragic isolation of immigrants without legal recourse or access to families – are now common fare in both the mainstream and alternative media.

 What’s new in this latest report on the country’s abusive and systematically outsourced immigrant detention and imprisonment system is that the contractor that runs the NYC detention center is an Alaska Native Corporation (ANC) – one of the dozens of such corporations that since 2000 have cashed in on billions of dollars of preferential and often no-bid, single-source contracts from the defense, homeland security, interior, and energy departments.

 Many of the recent immigrant-outsourcing stories involving private prison firms are of remote prisons, many along the border, where immigrants are mass incarcerated and mass processed for deportation. In this case, though, the maltreated immigrants are largely New York residents who are locked up in a little-known immigrant jail on the fourth floor of the federal building in Greenwich Village.

 The Varick Street Detention Facility is an Immigration and Customs Enforcement (ICE) facility with a 275-500 bed capacity that sits three floors above the local Greenwich Village post office on the corner of Houston and Varick Streets. There are no open-air or recreational facilities in the lock-up, which functions as a temporary holding center for male immigrants picked up by Homeland Security’s ICE or other federal agents in the New York City area.

As many as 11,000 immigrants pass through the Varick lock-up every year. The Native American corporation Ahtna Inc., which is increasingly specializing in immigrant detention, has a collection of management, operational, custodial, and maintenance contracts to run the immigrant holding center for ICE. 

Its subsidiary Ahtna Technical Services took over the operation and management of the facility in 2008 after ICE reopened the controversial detention center – which had become unmanageably overcrowded in the late 1990s as the result of an influx of legal immigrants held on mandatory detention and deportation orders because of new laws that greatly expanded the number of deportable offenses, including drug possession.

The center also gained notoriety after of the 1999 death of a Dominican immigrant from untreated pneumonia.

Systematic Barriers to Legal and Community Support

 One of the main tragedies and abuses here -- and at most other immigrant detention centers -- is the transient character of immigrant detention and imprisonment. For lawyers and families, it is a challenge to find client and loved ones because they are routinely transferred to other, often far-removed prisons with little or no prior notification.

 Regarded as “aliens” with no right to be in the country, the federal imprisoning agencies at Homeland Security and the Justice Department give little consideration to the family, legal, or community ties that immigrants have made in the areas where they have lived or worked – in many cases for decades.

 When asked about the legal, emotional, and psychological problems of placing immigrants so far away from their families, community of friends, and legal and other support networks, Hassel Terry, warden of the Otero Processing Center in New Mexico, replied with a smirk:

“We are taking them away from their homes. They left their homes in Mexico or wherever else they came from. We are simply trying to get them back home.”

The Otero Processing Center, located in the barren desert alongside north of El Paso, holds ICE detainees from all parts of the country, including New York, Maine, Massachusetts, and other distant states. Warden Terry is an employee of the Management Training Corporation, the country’s fourth largest prison company.

Most of the immigrants held at the Varick center are transferred out of New York City to geographically remote and rural areas to larger ICE detention centers as well as to immigrant prisons and detention centers contracted out by the U.S. Marshals Service and the Bureau of Prisons – the two Justice Department agencies that imprison immigrants. Depending on their ICE- and Justice Department-defined status – legal or illegal, criminal aliens, asylum petitioners, fugitive aliens – the immigrants go to a succession of USMS, BOP, and ICE prisons and detention centers.

From the big city they are scattered throughout the country in a network of isolated privately run facilities that are federal in name only. Those immigrants (legal and illegal) with criminal records, often simply drug possession or driving violations, go first to Department of Justice prisons sponsored by the USMS and Bureau of Prisons – although all operated by private firms – and then to detention centers operated under the authority of the Department of Homeland Security.

 Immigrants without criminal records are also shifted to remote ICE detention centers in Texas and Louisiana where the per-diem fees are much lower than the $227.68 per day that ICE pays Ahtna Inc. for detaining immigrants at the Varick detention center.

  Immigration Consequences for Criminal Violations -- Double-Jeopardy

 What’s so striking – and so typical – about the horrors of immigrant detention at this ICE lockup in Greenwich Village is the double-jeopardy faced by immigrants, especially long-term legal residents. At the Varick facility, like every ICE, USMS, and BOP immigrant prison, the merger of misguided drug control and immigration control policies forms a juggernaut of enforcement -- from which there is no legal escape and which metes out immigration consequences for even nonviolent drug violations.

 The NYT story highlighted the case of a Haitian, described as a barber, interpreter, and legal resident of Brooklyn for 23 years, who had previously served time for a drug-related offense but now was being processed for deportation because of his criminal record—not apparently because he living and working illegally in New York.

“It is double jeopardy,” he protested, nursing a swollen jaw with teeth missing. “I become a diabetic here, because of anxiety, stress and suicidal conditions.” Bernstein described the case of another 25-year-old who had come to New York as a legal immigrant from Belize at age 2. As an adult, the Belizean immigrant had been working at Kentucky Fried Chicken to support his 5-year-old daughter, a citizen, when his sickle-cell anemia permitted.

Despite his long presence in the country, lawyers told him, according to Bernstein, that since he had old convictions for marijuana where was ineligible for release on bond or with an electronic monitoring bracelet. 

The Fordham Law Review has published an excellent report in its November 2009 edition that treats the Varick jail as a case study in the systemic barriers to legal representation. Next: What Does Ahtna Really Do?

Government Contracts Driven By New National Security Spending

Government contracts constitute a mammoth economic sector – more than a half-trillion dollars in federal contracts in 2008 alone, and most of this goes to large corporations that specialize in national security operations. Not included in that massive figure was the contracting done by state Homeland Security offices and by the private sector itself for their own cybersecurity and “critical infrastructure protection.” The fastest growing sector in federal contracts is information and communication services with the Department of Defense, Department of Homeland Security, and the intelligence community (sixteen government agencies including DOD intelligence agencies and DHS intelligence apparatus). Private contractors with intelligence and information-technology divisions are salivating over the boom in related government contracts.

Top Ten Government Contractors, 2008 _______________________________________________

Lockheed Martin Corporation $34,785,141,737 Boeing Company $23,784,593,887 Northrop Grumman $18,177,546,625 BAE Systems $16,137,793,437 General Dynamics $15,992,669,588 Raytheon Company $14,663,608,137 United Technologies Corporation $8,927,106,729 L-3 Communications Holdings $7,597,574,871 KBR, Inc. $5,995,025,351 SAIC $5,945,115,101 _______________________________________________ Source: USAGovernmentSpending.org http://www.usaspending.gov/fpds/tables.php?tabtype=t2&subtype=t&year=2008 Top Ten Homeland Security Department Contractors, 2008 _________________________________________________

Boeing Company $591,048,628 International Business Machines $486,219,723 Accenture Ltd $392,700,978 General Dynamics Corporation $391,294,040 Integrated Coast Guard Systems LLC $386,344,211 Unisys Corporation $367,722,670 SAIC $362,403,533 L-3 Communications Holdings, Inc. $329,431,785 Lockheed Martin Corporation $294,412,822 Booz Allen Hamilton Inc. $242,899,612 _________________________________________________ Source: USAGovernmentSpending.org http://www.usaspending.gov/fpds/tables.php?tabtype=t2&subtype=t&year=2008 Global Homeland Security 2009-2019 is a new report by VisionGain, an information provider to the defense industry and U.S. government. The company says that homeland security is “one of the defense industry’s newest and most promising sectors” and projects that global governmental spending on homeland security services and goods should top $141 billion in 2009. Included under the homeland security branch of national security are such boom areas as cybersecurity, infrastructure protection, border security, intelligence, disaster preparedness and response, datamining, biosecurity, and national health networks to respond to transborder threats. One industry report projects that twenty federal contracts will be valued at $180 billion in 2010 – 50 percent higher than the top federal contracting opportunities in 2009, and most of the new contracting will be from civilian agencies, notably DHS. Washington Technology, a information company that serves the high-tech industry, tracts IT government contracts and reports that traditional military contractors are also the government’s largest information and cybersecurity providers. Nine of the top ten are major military contractors, most of which now have dedicated intelligence and homeland security divisions. Top IT and Systems Integration Federal Contractors, 2009

___________________________________________________ 1 Lockheed Martin Corp. $14,983,515,367 2 Boeing Co. $10,838,231,984 3 Northrop Grumman Corp. $ 9,947,316,207 4 General Dynamics Corp. $ 6,066,178,545 5 Raytheon Co. $ 5,942,575,316 6 KBR Inc. $ 5,467,721,429 7 SAIC $ 4,811,194,880 8 L-3 Communications Inc. $ 4,236,653,555 9 Computer Sciences Corp. $ 3,435,767,906 10 Booz Allen Hamilton Inc. $ 2,779,421,015 ___________________________________________ Source: Washington Technology, Eagle Eye Publishers Inc., and Houlihan Lokey http://washingtontechnology.com/toplists/top-100-lists/2009.aspx Lockheed Martin leads the pack as it has for 15 straight years straight. Like last year, Boeing and Northrup Grumman rank No. 2. and No. 3, respectively. Although IT contracts are expanding rapidly, there are few new entrants to the list of top IT providers to the government. In Washington Technology’s list of the top 100 IT providers, there were just 12 new entrants while traditional military giants dominaed the list. In addition to those in the top ten, other military contractors that are now majors in IT include BAE Systems, United Technologies, CACI, Aerospace Corp., BearingPoint, General Atomics, Alliant Technologies, and Alion Systems – all of which have more than a half-billion dollars in federal information-technology related contracts. One of the largest sources of federal contracting at DHS has been the EAGLE (Enterprise Acquisition Gateway for Leading Edge Solutions) IT program, which awarded $8.2 billion in contracts in the past three years. Among the leading contractors are CACI, Booz Allen Hamilton, Lockheed Martin, SAIC, Northrup Grumman, General Dynamics, and BAE Systems – all major military contractors. Most of the EAGLE IT bonanza are in the form “indefinite-delivery, indefinite quantity contracts” that provide generous operating room for IT firms to determine their own enterprise solutions to DHS’ vast IT and cybersecurity needs. DHS claims that it has greatly improved its oversight and management capacity since its early years, but time and again DHS has attested to its heightened diligence with private contracting only to shock evaluators at its level of incompetence and failure to learn from past contracting failures. Given that the EAGLE contracts are a work in progress, it’s too early to assess their success at meeting DHS’ ever-expanding IT ambitions. You can find information about this massive DHS contracting program on the department’s “Open for Business” web pages. Initially, the multibillion dollar IT services program was handled by a DHS unit called the Enterprise Solutions Office. But in the face of congressional criticism that DHS was churning out private contracts without oversight or project management, the enterprise solutions office is now called the Acquisition Program Management Branch. The major military corporations have quickly formed new operations branches to focus on the national security opportunities outside of their traditional core contracts with the Pentagon and armed services. This year, for example, Northrup Grumman created a new Information Systems division to seek defense, homeland security, and intelligence IT contracts. Recognizing the interest in the Obama administration in cybersecurity and information war, corporations such as Booz Allen Hamilton and HP have created new cybersecurity divisions or subsidiaries.

Similarly, the new administration focus at DHS and elsewhere on transnational disease have led military companies such as General Dynamics to acquire health company subsidiaries to ensure a place in the expanding homeland-security health care market. As Washington Technology (May 7, 2009) noted in its recent overview of the IT boom in federal contracting, “Mergers and acquisitions are also playing a role for companies that want to stay current with their customers.” Next: Persistent Problems with DHS Private Contracting

Privatizing Homeland Security

Nearly one of three dollars of the annual $42 billion budget of the Department of Homeland Security budget flows to private contractors. The corporate community, led by the national security sector, has greeted with enthusiasm and outstretched hands this flood of homeland security dollars. But in the wake of this surge in contract dollars for homeland security are rising questions about the management and oversight of this outsourcing, the purported benefits to national security, and the rising power and influence of the national security sector – now led by corporations that dominate all military, homeland security, and intelligence contracting. Outsourcing Government The DHS budget has expanded rapidly since its creation in 2003 led by the rising numbers for immigration enforcement and border security. The annual budgets for immigration enforcement and border security (not including supplemental funding and special administration initiatives for border fences and drug control) have more than doubled since the creation of DHS, rising from $7.4 billion to $14.9 billion in 2009. Outsourcing to the private sector by DHS has increased at even a faster pace than annual budget increases, rising from $4.2 billion in 2003 to $13.7 billion in 2009. DHS is not alone in the rush to the private sector to do the government’s job. Outsourcing now defines governmental operations, with private contractors now doing everything from running prisons, protecting U.S. embassies, gathering intelligence, interrogating foreign prisoners, building border walls (virtual and real), and fighting our wars in Afghanistan and Iraq. Private contracting – promoted as “public-private partnerships” by both the corporate world and the privatization divisions of federal departments -- has far outpaced federal budget increases even for such favored programs as border security. The dollar amount of federal contracts for goods and services from the private sector – led by national security firms – experienced an unprecedented surge during the Bush administration, rising from just over $200 billion in 2000 to $528 billion in 2008. (See chart. Not included in these figures in intelligence outsourcing, which now dominated intelligence operations, accounting for an estimated 70 percent of the intelligence budget, estimated by GlobalSecurity.org to be $66 million this year.) Leading the way in private contracting is the Department of Defense, with a whopping $3.1 trillion in private contracts, followed by the Department of Energy and with DHS ranking sixth in federal contracts in 2008.

What’s The Problem? For the booming homeland security industry, this public-private partnership brings flexibility and innovation to protecting the homeland. Marc Pearl, president of the Homeland Security & Defense Business Council (established in 2004), told a management subcommittee of the House Committee on Homeland Security: “This partnership then provides our government with the ability to access the best solutions and capabilities to achieve mission success – a safer and more secure nation.” Soon after DHS opened for business there were new concerns that a “homeland security complex” was in the offing – much as the onset of the cold war raised concerns by President Dwight Eisenhower and others about the undue influence of a new “military-industrial complex.” For the most part, though, criticism about the role of private homeland security contractors has not touched on concerns about power, influence, or security achievements of the homeland security industry. Rather most criticism of the outsourcing practices of DHS has focused on the department’s incapacity to manage and monitor its private sector contracts. The toughest critics of DHS come from government itself – various congressional committees, the General Accounting Office, and the department’s own Office of Inspector General. Although congressional critics and government reports express concern about the waste of taxpayer money because of the lack of adequate procurement and oversight procedures, there is little evaluation of the DHS public-private partnership itself – and how much the government needs to rely on private firms for services that it formerly provided in-house. The issue of increased outsourcing is, of course, not one particular to DHS. It runs through government, which has since the 1980s increasingly relied on the private sector. The ideological conviction that the private market should be the engine of the entire economy, the associated political push to downsize government, weakened unions and the related effort to skirt unionization, and government strategies to cut costs and increase efficiency (oftentimes proving counterproductive) have all driven outsourcing of government functions.

Chart: Federal Contracts, FYs 2000-2008, USAGovernmentSpending.org Next: Federal Contract Dollars Creating New National Security Corporations

Homeland Security Partnership Promoted by New Business Council

Within the defense industry there is widespread talk of a more expansive partnership between government and business. The new partnership defense contractors are promoting extends beyond the Pentagon and the armed forces – the traditional partners in the military-industrial complex – to the intelligence community and the Department of Homeland Security. Private contracting by DHS – averaging more than $12 billion annually – now forms a fundamental part of a new national security complex comprising corporations with major intelligence, military, and homeland security divisions. One sign of this broadened public-private partnership is the Homeland Security & Defense Business Council, which was created in 2004. The council says that it provides “a forum among the leading private-sector companies and senior federal government homeland security leaders to implement the administrative and legislative landscape dictated by the creation of the U.S. Department of Homeland Security.” Most of its members are traditional military contractors, including such corporations as Lockheed Martin, L-3 Communications, Northrup Grumman, Raytheon, and SAIC. Marc Pearl, the business council’s president and CEO, told Congress that the council fosters the public-private partnership in Homeland Security because this “partnership provides our government with the ability to access the best solutions and capabilities to achieve mission success – a safer and more secure nation.” Partnership Includes Former Homeland Security Officials But the partnership goes beyond simply entering contracts with DHS. The council also populates its advisory board with former DHS officials. The seven members of its advisory board were formerly all in top positions at DHS and are now all involved in the booming homeland security business. Council advisor Andrew Manner, the current CEO of the National Interest Security Company, was, for example, the former chief financial officer at DHS. As part of the kind of partnership fostered by the business council, NISC (which has intelligence, homeland security, and defense divisions) was awarded an $8.8 million infrastructure-protection contract in October by DHS. The partnership was also on show at the council-sponsored Partners in Preparedness Symposium in September, where the featured speaker was former DHS Secretary Michael Chertoff. Now director of the Chertoff Group, which specializes in bringing security “providers” together with DHS and the Pentagon, the outgoing DHS chief Chertoff was honored in December 2008 with the council’s Distinguished Service Award. According to council president Pearl: “Secretary Chertoff has established incredible working relationships with all sectors involved in homeland security and our nation is the better for it. From the integration of the Federal Emergency Management Agency into DHS, to stopping up our porous borders, to improving tracking of the people and products entering the country, he has done a tremendous job to assure that the nation can go about its business safely and securely." The DHS’ sorry record of emergency preparedness and private-sector waste under Chertoff’s tenure apparently does not figure into the council’s concept of an effective public-private partnership. Waste, Abuse, and Mismanagement Since the beginning DHS has proved unable to manage the partnership with industry, as documented by a continuing series of reports by the General Accounting Office and the department’s own inspector general. These problems were highlighted at a special hearing last year of a subcommittee of the House Committee on Homeland Security. The hearing, titled “Waste, Abuse, and Management: Calculating the Cost of DHS Failed Contracts,” In its announcement for the hearing, the Subcommittee on Management, Investigations, and Oversight expressed its wrath and frustration at DHS’ continuing inability to properly oversee its private sector contracts: “Billions of dollars have been spent on contracts for programs that have been delayed, deferred, and/or discontinued resulting in a waste of taxpayer money. Unfortunately, the wasting of these funds was not haphazard or as a result of conditions that could not have been foreseen. On the contrary, the Department has failed to implement a “lessons learned” approach, which has resulted in the same mistakes being made over and over again. The financial cost of DHS failed contracts, as illustrated below [see chart], is close to $15 billion. However, this figure only represents the failed contracts illustrated herein. There have been numerous other contracts that have been delayed, discontinued or deferred after millions of dollars have been spent. The financial cost; however, does not take into consideration the cost to our homeland security.” Statements by subcommittee members, as well as by Homeland Security Committee Chairman Bennie Thompson (D-Ms.), lambasted the DHS for its lack of oversight and its practice of having private contractors monitor other private contractors. Introducing the hearing, subcommittee chairman Christopher Carney (D-Pa.) said that a “broken acquisitions process at DHS” sparked the hearing. “Tens of millions have been paid out to contractors for what amounts to nothing more than bad ideas and empty promises,” he complained. Rep. Thompson told the hearing that the DHS partnership with the homeland security industry had resulted in: “$5 million-dollar-a-mile fences; TWIC [transportation worker identification credential] cards that can’t be read; ships that don’t fit into ports; formaldehyde soaked trailers that make the occupants sick, and an information-sharing program that law enforcement personnel do not want to use. Taxpayers have had enough. Americans deserve a country that is safe, secure, and ready to respond in the event of a natural or man-made disaster.”

Problems and Costs of DHS Contracted Programs _______________________________________________________________ SBInet (Boeing) Lack of Defined Requirements; Wasteful Spending; Mismanagement; Poor Contractor Oversight $1.549 billion Secure Flight (Lockheed Martin, IBM, MITRE, EagleForce, et al.) Lack of Defined Requirements, Mismanagement, Legal Noncompliance $200 million Deepwater (Lockheed Martin & Northrop Grumman) Lack of Defined Requirements; Wasteful Spending; Mismanagement; Poor Contractor Oversight $351.1 million EMERGE2 (Bearing Point) Lack of Defined Requirements; Wasteful Spending; Mismanagement 18.3 million TWIC (Lockheed Martin) Lack of Defined Requirements; Wasteful Spending; Mismanagement $103 million HSIN (General Dynamics) Lack of Defined Requirements; Mismanagement; Poor Contractor Oversight $91 million ADVISE (Lawrence Livermore Labs) Lack of Defined Requirements, Mismanagement, Legal Noncompliance $42.5 million US VISIT (Accenture et. al.) Lack of Defined Requirements; Wasteful Spending; Mismanagement $10 billion Temporary Housing for Katrina Evacuees (Bechtel National, Inc., Fluor Enterprises) Mismanagement, Wasteful Spending $200 million Test and Hire Airport Passenger Screeners (NCS Pearson, Inc.) Lack of Defined Requirements; Wasteful Spending; Mismanagement $741 million Installation of Baggage Screening Machines (Boeing) Wasteful Spending, Mismanagement $1.2 billion

___________________________________________________________________ Source: Subcommittee on Management, Investigations, and Oversight, House Committee on Homeland Security, Sept. 17, 2008 Greater Innovation Not Restrictions In the face of increasing evidence that the private-public partnership at DHS has been abused and that many billions of dollars flowing into the new department have been plundered by the private sector, the Homeland Security and Defense Business Council -- the leading voice of the private sector in homeland security issues – is unrepentant and instead calls for more cooperation. At the September 2008 House hearing on DHS waste and mismanagement in private contracting, council president Pearl advised that Congress and DHS shouldn’t reduce their reliance on the homeland security industry. Nor should it introduce an oversight process that alienates the private sector. “New restrictions on government contracting won’t make our borders safer; greater innovation will,” asserted Pearl. “It would be extremely detrimental to our nation for the private sector to walk away,” said Pearl. “That would only lead to failure for both DHS and our nation.” Without acknowledging that too often homeland security contractors – such as Lockheed Martin and Accenture – have failed to deliver promised goods and services, Pearl pointed out in his testimony that council “members are responsible for the operational component of a contract – serve as a resource to this Committee and the Department.” Pearl recommended a deepened partnership in which the Homeland Security and Defense Business Council – “as a neutral but very interested actor” -- would function as “a conduit between the public and private sector to achieve these goals of reform.” Aside from directly promoting the interests of homeland security/defense businesses, the council is, among other things, cosponsoring a homeland security certification program at Georgetown University, which now offers a certificate in Homeland Security Studies. The council also has a Thought Leadership Committee that works to ensure that the private sector’s views on homeland security contribute to public policy discussions. Among council members are such leading government contractors as Accenture, BAE Systems, Bechtel, Booz Allen Hamilton, CACI, Deloitte, DRS Technologies, DuPont, DynCorp, General Dynamics, IBM, L-3 Communications, Lockheed Martin, Northrup Grumann, Raytheon, SAIC, and Unisys. Next: Privatizing Homeland Security

The Homeland Security Boom

(Part of a BorderLines series on the Homeland Security Complex.)

Color it red. The Obama administration has left in place the brightly colored, much-criticized terrorism threat chart of the Department of Homeland Security. But new administration and congressional policies and budget priorities are provoking elevated levels of activity in the counterterrorism market. The fifth annual Homeland Security Investors Conference on Oct. 21 in Washington, DC brought featured the largest number of sponsors, presenters, and participants. Excitement about billions of dollars in DHS contracts was feverish. John Mack III, executive vice president of conference sponsor Imperial Capital, said the homeland security business is booming. One reason for increased corporate attention to homeland security, explained Mack, is widespread perception that Democratic Party politicians are more willing to increase spending for homeland security than for defense. Mack told Homeland Security Today that among investors “DHS s seen as a model for public and private partnerships." What is more, at DHS "there are just so many different long-term programs" in so many different areas, particularly identity solutions, critical infrastructure protection and information security. Furthermore, "the macro trend is that the government is the only one spending money." Since its creation in early 2003 DHS has been constructed as a public-private partnership fed by an ever-larger homeland security budget and a departmental proclivity to outsource homeland security operations. This so-called partnership has, together with increased intelligence outsourcing to private firms, greatly boosted the national security contracting by the federal government but also given rise to a new national security complex that joins defense, intelligence, and homeland security spending. The leading firms in the military-industrial complex, such as Lockheed Martin and SAIC, are also the leading intelligence and homeland security contractors. The Homeland Security Investors Conference was just one indication of the meteoric rise in homeland security business. Since the terrorist attacks of Sept. 11 there has been a proliferation of homeland security and border security conferences that aim to grow a security partnership between government and business.

What distinguished the latest of these conferences was its focus on the new merger & acquisitions market in the homeland security industry. Conference sponsors were investment firms like Imperial Capital, Civitas Group, and CapitalSource.

Next: Homeland Security Partnership Promoted by New Business Council

Death in Texas

(The following is an excerpt from a recently published essay of mine in the Boston Review. It is online at http://bostonreview.net/) The Obama administration has deftly deflected ethical arguments against mass detention with liberal rule-of-law logic. DHS, it argues, is simply upholding the rule of law by consistently and wholeheartedly enforcing immigration statutes and securing the border. Rather than echoing or shadowing the ideological restrictionism of the right, as the Bush administration did, the Obama administration argues that enforcement-first immigration policy will establish the political foundation for immigration reform. But there is no sign yet that the administration or the Democratic leadership are willing to lead the way toward durable immigration reform that would address both the future structure of immigration and the failures of the existing immigration system. Such a reform should be based on measurements of how immigration flows affect existing wages. Armed with these benchmarks, we can establish how much new immigration is sustainable. The goal is both to ensure that new immigration will not undermine wages or working conditions in the U.S. labor force, and, at the same time, to allow American society and the economy to benefit from regulated flows of unskilled and skilled labor. Reforms would need to account for unauthorized immigrants who for many years were tolerated or even welcomed in the United States. These immigrants and their families have integrated into this country, and should now be accorded a path to citizenship. As the immigrant crackdown continues, hundreds of thousands of immigrants like Jesus Manuel Galindo will be caught in the profit-driven public-private-prison complex. In the end though, the human cost of the system is unlikely to bring it down. It may only be when citizens and politicians start questioning the financial cost of incarcerating immigrants that these public-private prisons will go bust. Meanwhile, the 26 inmates identified by GEO as having been involved in the riot following Galindo’s death will spend an additional year in detention. After the initial April 2009 count against them failed to elicit guilty pleas—there was little hard evidence—the U.S. Attorney’s office added another count to the indictment under an obscure statute requiring a mandatory ten-year sentence for the use of fire in the commission of a federal crime. Under threat, all plead guilty to the first charge. More than one hundred inmates will be indicted for the second riot. Reeves County recently approved another $15.5 million in project revenue bonds to pay for prison repairs and upgrades that will not be covered by insurance. If the County does not make the costly improvements, it may lose its BOP contract to imprison criminal aliens. County Attorney Alvarez knows what is at stake. “Without that prison,” she told the Commissioners Court, “basically, Reeves County is going under.” Photo/Tom Barry: Reeves County Detention Center

Immigrant Gulag Larger Than Homeland Security's Detention Centers

The Obama administration is trying to wiggle its way out of the immigration crisis created by the Bush administration without taking any decisive steps to distance itself from its predecessor’s immigration policies and enforcement practices. The recent announcements by Department of Homeland Security Secretary Janet Napolitano and officials from the department’s Immigration and Customs Enforcement (ICE) agency about reforms in ICE’s rapidly expanding immigrant detention system highlighted a tragic part of the back-end mess created by the ICE-led crackdown on immigrants. But rather than facing the crisis head-one, the Obama administration has opted for some administrative tinkering to remedy some of the worst features of ICE’s enormously expensive and shameful detention and removal operations (DRO). Immediately after Sept. 11 the Bush administration, counting on Democratic support, began beefing up immigration enforcement. As part of the process of creating the Department of Homeland Security, the administration mandated a more aggressive and comprehensive immigration enforcement regimen—which was charted out in the Operation Endgame strategy document produced by DRO. Published in 2003, Operation Endgame set out a ten-year strategy plan to: “Promote the public safety and national security by ensuring the departure from the United States of all removable aliens through the fair and effective enforcement of the nation’s immigration laws.” With the endgame clearly stated—removing all removable aliens—all that obstructed the implementation of the strategy was funding and enforcement mechanisms. With strong bipartisan support—which has continued into the Obama administration—DHS has been raking in ever-increasing congressional authorizations for enforcement funding and DHS has responded with a never-ending stream of new enforcement initiatives such as Return to Sender, Operation Streamline, and Secure Communities. Congress has also proved quite willing to authorize the creation of new immigrant “beds” for captured immigrants remanded for detention and removal. Detention beds for immigrants have tripled since the mid-1990s—up to 33,000 for a projected 440,000 immigrants who will be processed for deportation in 2009. With all the money it can handle—$1.8 billion for detention this year—and congressional exuberance for enforcement, DHS has been steadily expanding detention space for immigrants, even opening new detention center for arrested immigrant families. But rather than directly taking on the responsibility for the mass detention of immigrants picked up by its Operation Endgame’s commitment to remove all removable immigrants, ICE has outsourced this responsibility to a complex patchwork of public/private detention centers. Typically, detained immigrants are now sent to privately operated prison-like detention centers that are oftentimes owned by local governments intent on padding budgets with detention per diems paid from the seemingly bottomless ICE coffers. Technically, these immigrants are under ICE custody, but the detained immigrants rarely if ever see ICE officials. In theory, at least, immigrant outsourcing could work if there was proper oversight and control of the private prison industry and the sponsoring local governments. In practice, though, ICE exercises little oversight, leaving the welfare of the hundreds of thousands of Operation Endgame immigrants in the hands of the so-called privates and of the prison towns, both of which see immigrants in terms of increased immigrant streams. However, even within the half-dozen ICE owned and operated immigrant detention centers most of the custodial care is outsourced to private operators. Operation Endgame focused on what it would take to remove all removable immigrants by 2012. Left out of the strategy was a plan to ensure that DRO would be properly and humanely managed. Rather than charting out a civil detention system, “removable aliens” have been routinely treated as criminal detainees and channeled into privately run prisons where they are treated as criminals. In prisons in remote rural locations—mostly along the Southwest border—these immigrants are systematically cut off from legal support, family contact, and proper medical care. Horror stories of unnecessary deaths in detention—104 immigrants have died in these temporary detention facilities (where the average stay is 31 days) since 2003—have resulted in a wave of shocking investigative and policy reports as well as class action lawsuits. All the bad publicity and the rising costs of maintaining a badly flawed system forced the new administration to act. Recognizing the detention center mess its enforcement programs and Endgame strategy have created, the Obama administration now promises to create a “truly civil detention system” that will come under strict ICE oversight. ICE has said that over the next five years its new Office of Detention Policy and Planning will overhaul its detention complex and locate new ICE detention centers near major cities to ensure better oversight and family/legal support. The promised reforms in ICE detention are certainly welcome and long overdue. But in the administration’s failure to call a halt to the Operation Endgame strategy and the ensuing immigration enforcement programs, the administration has highlighted the essential continuity in Bush administration immigration policy and practices. In fairness, neither President Obama nor DHS Secretary Janet Napolitano ever promised an entirely new direction in immigration policy. By couching immigration enforcement within “a nation of laws” policy framework, Obama administration officials have repeatedly signaled a strong commitment to law enforcement along with a much weaker commitment to policy reform and a change in laws that categorize otherwise law-abiding immigrants as criminal aliens. Instead, it has stepped up immigration enforcement through a phalanx of criminal alien and border security programs in the name of enforcing the rule of law. It comes as no surprise, then, that both ICE director John Morton, a career prosecutor, and DHS Secretary Napolitano predict that the number of immigrants processed by DRO will not diminish under their tenure. As recently reported in the Miami Herald, Napolitano admitted that detention reforms by no means imply fewer immigrant arrests. “We accept that we are going to continue to have and increase, potentially, the number of detainees,'' Napolitano said. Even more striking, perhaps, than the continuing DHS commitment to massive detention and removal has been its bureaucratic blindness to the full extent of the back-end detention mess. Its failure to heed the lessons of recent policy history is equally startling. In the late 1990s Congress and the Clinton White House reacted to the rapidly expanding (although at much lower levels than currently) detention system managed by the Department of Justice (DOJ). Increased immigration flows and harsh new laws that targeted both legal and illegal immigrants resulted in a badly managed, largely unaccountable patchwork detention system. In a half-hearted although welcome initiative, Congress authorized the creation of an Office of Federal Detention Trustee (OFDT) in an attempt to systematize, rationalize, and regulate the detention systems run by the U.S. Marshals Service (USMS) and the Immigration and Naturalization Service (both DOJ agencies). The Justice Department’s OFDT opened in September 2001 but was never able to function as the coordinating office envisioned by reformers. The creation of DHS took the major component of federal detention out of DOJ hands, and the pre-Sept. 11 concerns about unregulated, uncoordinated detention centers faded in the post-Sept. 11 policy environment. All immigrants arrested by the Border Patrol and ICE eventually pass through ICE-sponsored detention centers. But for an ever-increasing percentage of immigrants being processed for removal, these centers are only the last stop before deportation. As many as a third spend time in USMS detention centers and Bureau of Prisons (BOP) facilities before being remanded to ICE. As part the Operation Endgame strategy, DHS laid the policy framework for imprisonment not just detention. Prior to detention a deterrence strategy would kick in—sending a message to future unauthorized immigrants that they would be treated as criminals before deportation. According to the strategy, DHS “promotes a balanced and integrated enforcement strategy, which ensures that the probability of apprehension and the impact of the consequences are sufficient to deter future illegal activity….We will create consequences for and deterrence to illegal immigration. DRO’s service and enforcement partners work diligently to identify, locate, apprehend, process, and remove aliens who violate this nation’s immigration laws.” ICE Director Morton’s promise to create a “truly civil detention center” is at best disingenuous and at worst deceptive. Morton oversees an aggressive enforcement apparatus that sends hundreds of thousands of illegal and legal immigrants into the core of the country’s criminal justice system where they are treated as criminals in a mushrooming array of USMS detention centers and BOP prisons along the border. Both BOP and USMS rely on the same patchwork system of private operators and county-owned prisons that ICE depends on—mostly privately operated and locally owned prisons for profit. The two Justice Department agencies have created an array of separate but not-equal prisons for “criminal aliens”—most of whom are criminals only because of ICE’s new enforcement practices and abusive deterrence strategy. Like the ICE detention centers, these immigrant prisons and centers (for pre-sentenced immigrants) are characterized by their lack of transparency, lack of accountability, outsourced responsibility, and abysmal medical care. Since the mid-1990s and especially in the past several years, as the immigrant crackdown has hardened, BOP and USMS have been frantically searching for new private and public partners to provide lockups for the masses of immigrants sent their way by ICE. Because of their designated criminal alien identity, the abusive conditions of these immigrants under Justice Department care have failed to attract the same kind of media, nongovernmental, and legal attention that led to the recently promised ICE reforms. Exercising more oversight over the ICE detention system is certainly a necessary part of immigration reform. But even as it promises welcome upgrades and changes in its own detention system, ICE continues to steamroll ahead with its Operation Endgame enforcement and incarceration strategies that have resulted in a veritable gulag of immigrant inmates. Photo/Tom Barry: Advertising for immigrant prison guards in Pecos, Texas

Talking About Insurrection

Getting into the federal building in Pecos, Texas takes political sophistication – something I was apparently lacking when attempting to enter the building for the trial of a couple of immigrant inmates indicted for their role in the Dec. 12-13 incident, let’s call it, at the immigrant prison in this far West Texas town. It’s the same all over the country. After Sept. 11 the federal halls of justice have been on virtual lockdown status. To get into these buildings – which typically house the district courts and U.S. Marshals Service offices, you need to pass through metal detectors, present identification, and rid yourself of all electronic devices. As many as half dozen or more federal security guards – usually retired police officers and sheriff deputies – are usually in the courthouse foyer to block entry to criminals and terrorists. In Pecos, which has a privately run, federally supplied, and locally owned immigrant prison on the outskirts of town, people are feeling jittery about the criminal alien business. It’s a business that has for the past two decades been a source of a steadily expanding number of local jobs and increasing county revenues, as the prison has gone through three expansions to accommodate the ever larger number of immigrant inmates under Bureau of Prisons custody. I felt it as soon as I stepped pass the doorway: suspicion and outsider disdain. “What are you here for? Who are you,” one of the guards demanded. “Well, I am here for the trial of the immigrant prisoners indicted for the disturbance at the prison last December,” I said, handing the questioning guard my business card (from Center for International Policy). “Disturbance, there was no disturbance,” says he. (It wasn’t until later that I asked how HE was.) “There was a riot, and it’s costing us tens of millions of dollars.” During several trips to Pecos since the second inmate news event of Jan. 31 –Feb. 5, I had been alternating between “riot,” “protest,” “mutiny,” and “disturbance.” What happened at the Reeves County Detention Center in two separate occasions was that immigrant inmates – officially classified “criminal aliens” who will be processed for deportation upon completing their 1-5 year sentences – set fire to prison buildings to protest the deaths and untreated illnesses of fellow prisoners. In both cases, the main prisoner concern was that sick inmates were being placed in the Secure Housing Unit (SHU) assigned for “medical observation.” The SHUs in modern prisons and detention centers are the modern equivalent of the old “solitary confinement” – intended as both punishment for disciplinary infraction and as deterrence to prevent unruly behavior. But, as the practice at the Reeves County Detention Center, SHUs are often used simply to better manage prison populations – to isolate and punish problem inmates whether they break the rules or not. At the Reeves County Detention Center (RCDC) – which since 1985 has expanded from 300-bed prison to one that holds up to 3700 inmates – the SHU is systemically and routinely used to house severely ill inmates. That’s because there is no infirmary at what the prison giant GEO Group (which the county contracts to run the BOP prison) calls RCDC “the largest detention/ correctional facility under private management in the world.” The first incident was precipitated by the death of Jesus Manuel Galindo, 32, who was serving a 30-month sentence for illegal reentry from Mexico. Galindo was picked up by the Border Patrol after an epileptic seizure at a convenience store near the borderland town of Anthony, NM, where he had lived with his family since he was in his mid-teens. The local police, who responded to the call for assistance from the clerk at the local 7-11, turned Galindo over to the Border Patrol after it was determined he was an “illegal alien.” Galindo, after being deported to Ciudad Juárez (about 20 miles from his home in the United States), attempted to return home to his extended and nuclear family (three children and second wife) – all of whom were legal residents or citizens -- two years ago after spending a month in the Mexican border town across from El Paso. But increased border security and a new “criminal alien” policy that criminalizes and penalizes illegal border crossing combined to put Galindo into the federal slammer in Pecos, where an estimated 75% of his fellow inmates were also serving time for illegal border crossings and the balance for nonviolent crimes, mostly drug violations. Another severe epileptic seizure in mid-November 2008 sent Galindo to an area hospital – and in the SHU. The greatest fear of inmates at the Reeves County Detention Center is getting sick and being consigned to the SHU – what they call “el hoyo” (the hole). It’s the hole not because it’s so dark or dirty, but rather because it’s where there is no relief from the walls, the loneliness, the emptiness. Galindo corresponded frequently with his mother, Graciela Galindo. His letters from mid-November until the day before he died tell of his fear and despair at being kept in the hole without any company, without the friends he made in prison. He tells his mother of the inhumanity of most of the guards who didn’t seem to recognize the humanity of the immigrant inmates. He writes of the urgency to get the right medicine to prevent his seizures – medicine, his mother told me, for which he had a prescription before he was imprisoned but was replaced by the nurses at Reeves with sedatives that kept him sleepy and unable to stand up. On Dec. 5 he wrote of being “afraid” of what would happen to him if he stayed in the hold any longer, of how his was being ignored by the guards and nurses, of his bruises from thrashing around during unattended seizures. The day before he died he wrote a letter to his mother that the family didn’t read until much later when they received his few personal belongings along with his body. In his Dec. 11 letter he wrote: “I told them that I have been here (in SHU) for a month, and I’ve gotten sick twice, and let’s see if they move me or do something quickly. All they say is 'yes, yes.' and they don't do anything.” What happened after two of his fellow inmates in the SHU saw his body being removed in a black body bag on the morning of Dec. 12 is a matter of interpretation and interests. The Dec. 12-13 incident resulted in some damage – several hundred thousands of dollars -- to the SHU and in a badly burnt recreation building. Reeves County attributed the property loss at the RCDC III prison (the most 2005 expansion of the immigrant prison) to a “disturbance.” Calling it a “riot” would have precluded the insurance company from covering the losses, said County Judge Sam Contreras. The inmates themselves referred to it as a “motín” or mutiny – a term that conveys the sense of an uprising against authority. After the Dec. 12-13 incident in Pecos and after the second closely related incident of Jan. 31-Feb 5 (when inmates also rebelled and set fire to prison buildings in an incident also sparked by medical malpractice and mistreatment concerns involving the use of the SHU for “medical observation”), the criminal justice system, the insurance system, and the financial system are providing most of the follow-up. Despite demands by the Texas ACLU and immigrant advocacy groups, the Office of Inspector General of the Justice Department has not initiated an investigation. But the criminal justice system did immediately kick in other respects. The U.S. Attorney’s Office in Midland, Texas immediately began investigating the new crimes of the immigrant inmates who, in part out of solidarity with those sick fellow prisoners shut in the hole and in part out of fear that too would be released from prison in a body bag, took control of the two different sections of the prison to highlight their concerns. Like the inmates, the U.S. attorney called the incidents “mutinies” and like the media and the security guards in the federal building lobby is also referring to the incidents as riots. Twenty six inmates from the first incident have been indicted. At first, they faced two counts – causing a riot or mutiny, or aiding and abetting in a mutiny or riot. The first count declared that the defendants “and other persons known or unknown to the grand jury, unlawfully, willfully, and knowingly, did combine, conspire, confederate and agree together and with each other and others to instigate, connive, attempt to cause, assist, and conspire to cause a riot at the Reeves County Detention Center, a federal penal, detention, or correctional facility.” (Apparently, the U.S. attorneys are as confused as everyone else about what the Reeves County Detention Center really is, a prison or detention center. And while it does hold federal prisoners – all immigrants with orders for deportation – there is much confusion about whose prison is it. It is county owned – hence the Reeves County – but it is operated by GEO Group while the BOP contracts with the county to run it and the county subcontracts with GEO.) The second count was the essentially the same but in this count the defendants purportedly “aided and abetted by each other and others did instigate, connive, attempt to cause, assist, or conspire to cause a riot.” In brief, the criminal indictment described the incident as a “mutiny or riot.” Those two counts were filed April 9 and May 12. But they didn’t have the desired result. Not all the defendants were entering guilty pleas, thereby saving the U.S. attorney the trouble of presenting evidence and actually trying the case. Then, on July 14, the U.S. John Murphy came to the grand jury with a superceding indictment that includes a new charge: “the use of fire to commit a federal felony offense.” Mary Stillinger, one of the court-appointed attorneys appointed to represent the immigrants, said the new indictment “really hammered” the immigrants, since it came with a mandatory ten-year sentence. There was little hard evidence against the men, and even with the court-appointed defense attorneys, most of whom simply go through the motions of defending immigrants in the flood of criminal charges resulting from immigration violations that is overwhelming the judicial system along the border. As part of the prison reconstruction, GEO has insisted that the county install a comprehensive system of security cameras and video recording units so as to insure that the next time around, as was explained in a county commissioners meeting in Pecos by the architect directing the reconstruction: “Cameras and recording equipment are among the highest things on their list, because if say that if they had more security cameras, better recording equipment, when they had this disturbance, they would have been able to prosecute more, indict more people, if they had more proof of what everybody did.” No one in a position of responsibility– not in county government, not in GEO, not in the correctional healthcare subcontractor Physicians Network Association (of Lubbock, Texas), not in the BOP , not in the U.S. Attorney’s Office – is apparently concerned of prosecuting, indicting, gathering evidence, or even investigating the conditions at RCDC that sparked the riots and the death of Jesus Manuel Galindo. But the county has other concerns that involve high finance and keeping prison jobs in Reeves County. Since 1985 the county has issued approximately $115 million in revenue bonds to finance the construction and maintenance of the RCDC immigrant prison complex. Going into the riots/mutinies/disturbances, the county had $92 million in outstanding prison debt. This debt is in the form of tax exempt municipal bonds called project revenue bonds that are issued by a specially established county public facility corporation to create a project that brings revenue to the county. The county got off relatively easily from the first incident. The insurance companies paid by the county over the past couple of decades for the prison covered most of the rebuilding expenses. But then came the proverbial ‘fire next time.’ Less than two months after the first inmate protest, inmates renewed the Dec. 12-13 protest with a much larger incident – one that completely destroyed the oldest prison unit and resulted in reconstruction and upgrading expenses project to approach $40 million. This time the insurance companies are expected to come through with only $25 million, leaving the county $15 million short. Here comes Barry Friedman of Carlyle Capital Markets, the bond underwriting firm that has been with Reeves County since the beginning of its prison enterprise. Friedman assures the county that he can sell another $15 million plus in bonds to cover the gap. “I have been on the side of Reeves County since 1986,” Friedman recently told the county commissioners, assuring them that he only wants what is good for the county. Not only is Friedman underwriting the new bond issue but after the prison disturbances he was hired as a special financial consultant to the county for about $15,000 a month. In addition to his commission for bond underwriting, he is also advising the county on what is in their best financial interest, as he told the commissioners. “As financial adviser, my responsibility is to the county,” he explained, angrily and righteously dismissing a complaint raised by County Attorney Alva Alvarez. “Do you represent the bondholders,” he was asked. “No, I represent the county,” he replied. Reeves County is angry, worried, and deep in debt – and going deeper. No wonder then the reaction of the elderly security guard at the federal building. After I asked who he was, he threatened to call the U.S. Marshals. Knowing about justice in Reeves County, I turned around and walked out. Just as well, the immigrants had all decided to plead guilty. The scheduled trial was cancelled. Tempers are also flaring in the county building across the street with conflict-of-interest charges swirling around having Carlyle’s Friedman work two sides of the prison business and with fears that if the county doesn’t get the prison back together the BOP might, as one county official noted, “bring in the buses and bring the inmates out.” That would leave Reeves County with massive prison bond debt, Pecos with any empty prison complex on the edge of town, and more than four hundred area residents without a job. It would be a near fatal blow to the county, where a quarter of the population lives in poverty and unemployment stands at 14.1%. Poor Reeves County. And poor immigrants who still suffer the same medical conditions that sparked the incidents.

See related articles: Tom Barry February 24, 2009 “Medical Claims and Malpractice in Correctional Healthcare” http://americas.irc-online.org/am/5895 Forrest Wilder October 2, 2009 “The Pecos Insurrection” http://www.texasobserver.org/features/the-pecos-insurrection

Photo/Tom Barry: Pecos prison reconstruction