Last night I was out having a couple beers (okay, it was a couple pitchers) with my friend and talk inevitably turned to how depressing it is living in Commander Cuckoo Banana’s world, where you never know what’s gonna happen next. I started telling him about this Haliburton/KBR story I came across the other [...]
Commentary By: somegirl
Last night I was out having a couple beers (okay, it was a couple pitchers) with my friend and talk inevitably turned to how depressing it is living in Commander Cuckoo Banana’s world, where you never know what’s gonna happen next. I started telling him about this Haliburton/KBR story I came across the other day, which combined with this one and this one got me so worked up I had to stop reading news for a couple days. Nonetheless I vowed to myself that I would work harder to overcome the despair that frequently paralyzes me when I try to put together something to post here, and tarry on.
I’ve never been able to understand the push for the use of independent contractors. Wait, let me rephrase that – I’ve never been able to understand how contractors succeeded in selling their services as cost saving measures to the people who use them, and to the general public. I don’t see anyone talking about it actually saving money now, but do remember that cost cutting was the primary selling point when the idea was introduced as part of the streamlining of the peacetime military. Now I see that it was just another component of the evil empire’s plan to make gazillions off of perpetual war.
I used to be involved in a non-profit organization that experienced a big drop in donations after 9/11. In order to deal with the loss of income, they looked to some corporate bigwigs (their first mistake) to tighten up operations. I watched in horror as they, over two short years, destroyed (to my eyes) an organization I had loved dearly, partly by substituting contract labor for inexpensive and volunteer workers. They paid the contractors exorbitant fees and the contractors in turn abused their workers and skirted every labor law they could, a la Wal-mart. These practices, and the adoption of the culture they engendered, led to my leaving the organization. So I kinda take this stuff personally, and I’ve seen firsthand, though on a much smaller scale, how easily an organization that previously had struggled financially, but thrived as an institution, with committed, caring and valued workers, can be corrupted when it adopts certain corporate values. In that way I think it very much mirrors the military and its privatization.
But anyway, back to Halliburton, or more accurately their tax dodging subsidiary KBR. It seems that there’s an awful lot of disability and workers comp claims cropping up now from all those contract workers being lured to Iraq with promises of big tax free salaries and benefits. And surprise, surprise, Halliburton’s insurance company, AIG, immune to the suffering of the sick and injured as only insurance companies can be, is in no big rush to pay up.
‘Insurance companies are not used to doing this sort of thing in the numbers they are coming in,’ says Washington, DC., attorney Mark Schaffer, who also represented a Merez bombing victim who received medical leave, but only after bickering with adjusters for three months. ‘Everyone is playing catch up.’ (snip)
‘AIG is dragging its heels and they only have three adjusters working the claims, so they are swamped,’ says Pitts.
Oh poor AIG! Of course it takes a long time if you’re trying to prove the claims are fraudulent. If they weren’t looking to get around paying them it would be no big deal to collect the information and cut the checks. And why don’t they just hire a few more people to process the claims or transfer people from other departments? It’s not looking like this is going to be a temporary situation. And it’s not like they haven’t had time to adjust to this predicament. It’s even been in the news now for almost a year, so there is just no excuse. Except that they’ve been very busy committing and covering up fraud themselves, especially despicable when apparently they were doing quite well without it. But after all, they serve the master, Halliburton, not their poor slaves.
Maybe this is common knowledge, but it was news to me:
Coverage for employees of U.S. contractors, regardless of citizenship, is required under the 1941 Defense Base Act, just as workers in the United States must have workers’ compensation insurance. Military personnel are not eligible and have a separate program.
Insurers are not required to provide coverage under that act, so as an enticement, the government promises reimbursement to carriers for war-related claims.
And it’s not like AIG isn’t making a huge profit from this ï–¿–½riskï–¿–½.
Rates have ranged from an early low of $10 per $100 of an employer’s payroll to as much as much as $40 per $100 of payroll in recent months, said Hartwig of the insurance institute. That means an employer with a million-dollar payroll would pay between $100,000 and $400,000 in premiums.
So since the government is going to reimburse the insurance companies, the premiums are more like the cost of a loan while they wait to be reimbursed by the government. Do they stall on the loans just because they’re pissed that they’re not being reimbursed quickly enough?
But escalating claims are creating concerns for insurers despite the promise of government reimbursement, mainly because it can take the government months to investigate the claims and pay the insurer. In the interim, insurers are responsible for paying the claims, creating cash flow problems even though they get to keep the premiums.
Correct me if I’m wrong, but aren’t we lowly taxpayers paying for all this twice? I don’t imagine that cost plus contracts exclude insurance premiums. And please, does anyone really expect us to believe that AIG has a cash flow problem? What a racket. Can someone please explain to me how this is better than having a regular military to perform all the functions it used to perform without a profit motive?
But it’s just the beginning of this particular quagmire because each and every employee of every single contractor and subcontractor is technically entitled to this coverage. Is it any wonder there’s no big push to be more on top of the paperwork in Iraq, especially employment records?
Again, from the Corpwatch story, which you really should read:
The General Accountability Office (GAO), the lead investigative arm of Congress, recently concluded that it is impossible to accurately estimate the total number of U.S. or foreign nationals working for U.S. government contracts in Iraq. The GAO’s investigation was prompted by concerns in Congress about insurance costs that Iraq contractors are obligated to carry, which are then passed on to the government.
‘It is difficult to aggregate reliable data on the cost of DBA insurance due in part to the large number of contractors and the multiple levels of subcontractors performing work in Iraq,’ the GAO reported. ‘Lacking reliable aggregate data, we were unable to calculate the total cost of DBA insurance to the government or the impact of DBA insurance costs on reconstruction activities in Iraq.’
Responding to the GAO’s report, Labor Department official Victoria A. Lipnic said that assuring all contracted employees have insurance coverage is an ‘impossibility’ without having someone in Iraq to ‘actually demand to see proof of coverage for every level of subcontracted work.’
In the end it’s just like the entire Halliburton Bush Crime Family Neocon Nightmare. I read an article, google for a little more information or verification, and I find an infinite stream of corruption and destruction of human lives. Kinda mind blowing, and very depressing.
Man, he sure is a President to be proud of, isn’t he? 
Remember the letter that Rep. John Conyers and 88 other Members of Congress sent to the preznit on May 5th about the Downing Street Memo? The one that the White House ignored and 