After the September 17 shoot-out, the Iraqi authorities said they would revoke the license that allows the company in question, Blackwater, to operate in the country. Today, the Iraqi government said it wants a review of all foreign security contractors operating in the country to determine whether they operate "in compliance with Iraqi laws."
U.S. State Department spokesman Sean McCormack, speaking on September 17 in Washington, expressed regrets about the killings. "Any time there's loss of innocent life, that is deeply regretted by us and everybody involved in the State Department mission in Baghdad and in Iraq. And we take every possible measure we can in order to avoid the loss of innocent life," he said.
McCormack said the matter is being investigated, and all information will be shared with the Iraqi government.
However, more than just one company is at stake. The shooting in Baghdad has put the spotlight on the thousands of foreign security contractors operating in Iraq, and has led some Iraqi officials to question why there are so many security contractors in the country -- with so little accountability.
Conservative estimates put the number of foreign security personnel in Iraq at well over 20,000. Some say the figure is as high as 100,000. They are heavily armed and some critics say they often act as little more than private mercenaries.
However, their defenders note that they play an essential role. They point out that foreign civilians working on reconstruction projects are in danger and cannot be left without protection.
The Lexington institute, a U.S.- based think thank, said in a recent report that "in essence, contractors are now the de facto third [legal] force" in the country. The first two are foreign troops, and the Iraqi army and police.
David Hartwell, an analyst with the London-based Jane's Information Group, says the biggest controversy posed by security companies is their accountability. "The delineation of where the command of the paramilitary companies and the military ends is a very, very gray area," he says. "And I think one of the problems that has been encountered in Iraq is: how far do they work for, and under the aegis of, the military commanders in Iraq, and how far are they working on their own?"
He says it is clear that the Iraqi government has very little influence on this foreign force, which comes from different countries from all over the world. Hartwell says not only U.S. private security companies but also companies from Britain, South Africa, and elsewhere are functioning in Iraq.
The contractors' independence from military command has caused concern for the U.S. military. The U.S. Government's Accountability Office said in a report last year that "private security providers continue to enter the battle field without coordinating with the U.S. military, putting both the military and security providers at a greater risk for injury."
Hartwell says there is no doubt people working for security companies have very good salaries, but he says it is difficult to guess how much a member of a security firm is paid.
The salaries differ from company to company. Blackwater says it pays its contractors between $450 and $650 a day.
Hartwell also points out that the security companies themselves are earning millions for their operations. For Blackwater, losing a contract in Iraq would mean huge financial damage.
"It's been one of the features of the Iraq campaign," Hartwell said. Private companies such as Halliburton, Kellogg Brown & Root (KBR), and others "have done extremely well financially out of the Iraq war and it's one of the more controversial aspects of the invasion," he said.
However, Hartwell says, the U.S. military relies on these companies, as it does not have enough troops to provide security for all the operations taking place in Iraq. And Hartwell notes that sending an additional 100,000 troops to Iraq would be politically impossible in the United States.