This article talks about the not so recent emergence of soldiers for hire. Mercenaries have been around since the Medieval Times. In Iraq and Afghanistan, the United States employed over twenty thousand mercenaries. This industry is valued at over one hundred billion dollars. 70% of mercenaries are British or American in origin and can be found around the globe. China employs both American and Chinese firms in defense of it’s development in Africa. Companies hire out firms to protect their interests in unsafe regions. Energy companies use private contractors to ensure their investments in infrastructure and equipment are not lost to bandits or local military groups.
Large scale wars have begun to slow down and many of these companies plan to market themselves to companies instead of foreign governments. Currently, 90% of the market has been from governments ranging from the United States to Colonel Qaddafi. Money not loyalty seems to be a major point to these companies and this has raised concern in the international community. These companies need to have rules in place so civilians are not hurt unnecessarily or “bad apples” do not go unpunished. Another fear is that governments will begin only hiring mercenaries who will not go out of their way to protect someone who does not pay them. Basically leaving the rest of a country to burn as an oil field remains safe.
Setting standards of training and knowledge for company’s’ employees may need to be addressed so that problems do not arise due to unregulated groups.
http://www.economist.com/news/international/21566625-business-private-armies-not-only-growing-changing-shape-bullets-hire
4 Comments
I find it interesting how security needed to protect developing economic interests has shifted to the private sector. In the early 1800s, the United States government sent the Marines to combat the Barbary pirates who were targeting merchants. My question is whether publicly or privately funded security needed for new economic interests provides the greatest social benefit. The firms exploring the economic interests benefit, but do they pass along these benefits to consumers in any way?
Do you think that soldiering should be provided on a public or private basis? It is interesting that mercenaries are beginning to market their services to corporations. Do you think that the diffusion of military skills and equipment to private entities will continue in the long term? I think that the potential exists for world governments to clamp down on a potential dangerous trend, which destabilizes the markets because of future uncertainty.
Is hiring mercenaries more or less expensive than employing an organized government army? Or is hiring mercenaries a function of a shortage of qualified fighters available in country?
How many firms are involved in this industry? I wouldn’t think there is low market concentration. There must be high barriers to entry: declining demand and significant start-up costs (training, infrastructure, etc.) should deter any entry. Does this make the price of their services a premium?
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