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The Rise and Future of Private Military Companies

Policy Brief by Kirupan Krishnarajah

On January 17th, 1961, President Dwight D. Eisenhower delivered his final speech as the 34th President of the United States.  Amidst Cold War tensions, President Eisenhower led a long and virtuous career within the public service and the military, being the Supreme Commander of the Allied Expeditionary Forces during World War II and later becoming the Supreme Commander of the North Atlantic Treaty Organization by 1951. [1] So, it did not come as a surprise when his final speech had a sharp focus on the ever-expanding sphere of relations that existed between the military and arms industry. The term he used to describe these relations was the "military-industrial complex." [2] 

His speech served as a warning; by 1961, the United States "[was] annually [spending more] on military security…than the net income of all United States corporations." [3] The military's role has become entrenched within American society itself, which presented a need to acknowledge the growing powers that corporations and private entities could wield – and the ever-increasing risk of "misplaced power" that came alongside it. [4] More specifically, he was concerned about the effects on America's conquest for "security and liberty," or foreign policy. There was a possibility of the public policy becoming "captive of a scientific-technological elite," where corporations would eventually have the power to precipitate a country's destiny and demise. [5] 

Eisenhower's speech is significant in various ways; he stressed the importance of delegating the responsibility of research and development within the military to private corporations and the vulnerabilities within the military-industrial complex. Yet, the military establishment has continued to grow, and so has the role that these private corporations and entities play today. 

What are PMCs (private military companies)? 

According to Carlos Ortiz, private military companies, or PMCs, are for-profit entities that offer “services that involve the potential to exercise force in a systematic way and by military means and/or the transfer or enhancement of that potential to clients.” [6] This definition represents the various roles PMCs have; individuals may work as consultants, logistics providers, and strategists, but more recognizably as mercenaries alongside private security firms. Mercenaries are armed individuals paid to support and contribute to military action and operations in “foreign conflict zones,” as defined by Sean McFate. [7] 

While the origins of PMCs are unclear, some believe that PMCs began to take form by the 17th century within the East Indies. [8] Here, risks associated with traveling between regions forced trading entities to form their armies and regiments to protect themselves. As outlined by Peter W. Singer, there are three “dynamics” responsible for the shift in the roles of modern PMCs, beginning with the start of the Cold War, the converging positions of soldiers and civilians within the military establishment, and the privatization of government processes and functions internationally. [9] By the end of the Cold War, instability arose within the developing world. With many trained soldiers no longer being needed from the fallout of the Cold War, it gave rise to a new era of PMCs, who were now able to take on a whole host of functions. These functions were representative of the wave of New Public Management (NPM) that favoured decentralization and privatization of public services to promote more efficient allocation of scarce resources with market forces. However, it is essential to come back to Eisenhower’s speech to understand the ramifications NPM has had on the security and military sector in the current century.  

What are some examples of PMCs? 

In the 21st century, PMCs have taken much more significant roles in international conflicts. Companies like G4S and Northrop Grumman have risen during the wave of NPM from the 1990s onwards. However, this brief will focus on a particular PMC: Academi – formerly known as Blackwater. For simplicity, this PMC will solely be referred to as Blackwater.  

Blackwater was founded in 1996 by Erik Prince, and aimed to “provide training in firearms, personal security, and counterterrorism.” [10] After the 9/11 terrorist attacks and the subsequent declaration of a War on Terror, Blackwater’s role and power increased, particularly during the Iraq War. Doing so, however, paved the way for further acts of atrocities and violence that led to the deaths of innocent civilians. By 2007, 100,000 private security contractors were in Iraq, 1,000 of whom were employed by Blackwater. [11] 

In September 2007, 17 Iraqis were killed, and 20 Iraqis were injured when Blackwater contractors opened fire on a car that was believed to be ambushing a convoy of U.S. officials in Nisour Square. [12] Investigations have found that the contractors failed to recognize that the driver of the car was not a threat, and still opened fire on the driver and other civilians. Blackwater soldiers were tried and convicted, one of whom was sentenced to life in prison, while the other three were sentenced to 30 years. [13] Yet, they have all been pardoned by President Donald Trump in December 2020. [14] 

Before this massacre, Blackwater was already under investigation for several instances of misconduct. During a hearing before the Committee on Oversight and Government Reform, Chairman Henry A. Waxman revealed that since 2005, there were 195 instances where Blackwater contractors were involved in shooting incidents. [15] But in a plurality of these incidents, Blackwater contractors were the provocateurs. Additionally, 1/7 of Blackwater’s forces in Iraq were terminated for “improper conduct.” [16] There is evidence of Blackwater participating in the Central Intelligence Agency’s (CIA) “extraordinary retention and rendition programs,” which has its own controversies associated with it. [17] 

As such, for a company awarded over $1 billion in federal contracts, it begs the question; does privatization bring along lower costs and better services? [18] 

What are the pros and cons of PMCs? 

With PMCs, or NPM more broadly, privatization of such governmental functions would, in theory, allow for efficient allocation of resources. This would decrease the costs of public services and allow for more responsiveness to the needs of the public. Therefore, PMCs should theoretically lower military expenditures. With NPM also emphasizing the importance of performance, PMCs should also bring about more reliable and better results at a lower cost.  

Yet, as seen in Blackwater’s controversies, PMCs seem to be less resolute to strict military conduct policies and oversight, allowing them to have long operated without legal accountability. In the aftermath of the Nisour Square massacre, Blackwater lost contracts with the U.S. government and spawned laws and regulations such as the Military Extraterritorial Jurisdiction Act and the accompanying Expansion and Enforcement Act of 2007 which expanded U.S. criminal law to Department of Defense contractors working abroad. [19] Anna Leander also brings up a point about authority and how allowing sensitive governmental agencies like the CIA to outsource their work to PMCs like Blackwater delegates authority and status. [20] It indirectly legitimizes PMCs and gives a justification for their actions, even if their actions have led to ramifications for the United States, and their ability to help further their motives and policies in regions like Iraq. A PMC contractor also cost the U.S. government six times as much as the typical army sergeant - $400,000 vs. $50,000-$70,000 per year. [21] 

Even with these cons, NPM and its associated theories about the pros of privatization and decentralization still stand in other sectors and governmental functions. Adding on, Blackwater is just one of many PMCs that operate today. As such, while details about Blackwater cannot be generalized to all PMCs, several issues exist within the PMC industry that must be addressed and resolved. 

What does the future of PMCs hold for us?

Eisenhower’s speech is significant because we are now seeing the consequences of “misplaced power”, which is paired with the military-industrial complex which has also swelled in size. As seen with Blackwater, there is a danger in granting PMCs such powers and roles. Blackwater avoided much attention to its illicit and abusive activities by legitimizing themselves and sidestepping oversight and regulation. In doing so, it led to the deaths of innocent civilians and has caused rifts within U.S. foreign policy.

With the advent of PMCs, norms on the state usage of violence are changing, with private actors now having the ability to monopolize violence themselves. The case of Blackwater exemplifies Eisenhower’s warnings of the ramifications “misplaced power” would have on society itself. While the military-industrial complex has brought along many positive changes for society, the increasing dependence on PMCs to support national and foreign security affairs shows that there is still a dire need to address the vulnerabilities and various oversight issues.


1. "Dwight D. Eisenhower," The White House, accessed March 5, 2022,

2. "Our Documents - Transcript of President Dwight D. Eisenhower's Farewell Address (1961),", accessed March 5, 2022,

3. Ibid.

4. Ibid.

5. Ibid.

6. Thomas Jäger and Gerhard Kümmel, Private Military and Security Companies: Chances, Problems, Pitfalls and Prospects (Wiesbaden, HE: VS Verlag für Sozialwissenschaften, 2007), 11,

7. Sean McFate, Mercenaries and War: Understanding Private Armies Today (Washington: National Defense University Press, 2019), 7,

8. Jäger and Kümmel, Private Military, 11.

9. Peter W. Singer, "Outsourcing War," Brookings, last modified March 1, 2005,

10. Corey Flintoff, "Timeline: Blackwater and Security Regulations,", last modified December 14, 2007,

11. Dara Lind, "Why Four Blackwater Contractors Were Just Now Convicted of Killing 17 Iraqis in 2007," Vox, last modified October 23, 2014,

12. Ibid.

13. Nicky Woolf, "Former Blackwater Guards Sentenced for Massacre of Unarmed Iraqi Civilians," The Guardian, last modified April 14, 2015,

14. Laurel Wamsley, "Shock And Dismay After Trump Pardons Blackwater Guards Who Killed 14 Iraqi Civilians,", last modified December 23, 2020,


16. Ibid.

17. Anna Leander, "The Paradoxical Impunity of Private Military Companies: Authority and the Limits to Legal Accountability," Security Dialogue 41, no. 5 (October 2010): 474,


19. Elke Krahmann, "The United States, PMSCs and the state monopoly on violence: Leading the way towards norm change," Security Dialogue 44, no. 1 (February 2013): 63,

20. Leander, "Paradoxical," 474.


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