A little more insight into how contractors are gaming the system:
http://newsobserver.com/news/nation_world/blackwater/story/1762376p-8044834c.htmlJerry Zovko's contract with Blackwater USA looked straightforward: He would earn $600 a day guarding convoys that carried food for U.S. troops in Iraq.
But that cost -- $180,000 a year -- was just the first installment of what taxpayers were asked to pay for Zovko's work. Blackwater, based in Moyock, N.C., and three other companies would add to the bill, and to their profits.
Several Blackwater contracts obtained by The News & Observer open a small window into the multibillion-dollar world of private military contractors in Iraq. The contracts show how costs can add up when the government uses private military contractors to perform tasks once handled by the Army.
Here's how it worked in Zovko's case: Blackwater added a 36 percent markup, plus its overhead costs, and sent the bill to a Kuwaiti company that ordinarily runs hotels. That company, Regency Hotel, tacked on its costs for buying vehicles and weapons and a profit and sent an invoice to a German food services company called ESS that cooked meals for the troops.
More at the link.