How the U.S. Funds the Taliban

By Aram Roston, The Nation. Posted November 13, 2009.

On October 29, 2001, while the Taliban's rule over Afghanistan was under assault, the regime's ambassador in Islamabad gave a chaotic press conference in front of several dozen reporters sitting on the grass. On the Taliban diplomat's right sat his interpreter, Ahmad Rateb Popal, a man with an imposing presence. Like the ambassador, Popal wore a black turban, and he had a huge bushy beard. He had a black patch over his right eye socket, a prosthetic left arm and a deformed right hand, the result of injuries from an explosives mishap during an old operation against the Soviets in Kabul.

But Popal was more than just a former mujahedeen. In 1988, a year before the Soviets fled Afghanistan, Popal had been charged in the United States with conspiring to import more than a kilo of heroin. Court records show he was released from prison in 1997.

Flash forward to 2009, and Afghanistan is ruled by Popal's cousin President Hamid Karzai. Popal has cut his huge beard down to a neatly trimmed one and has become an immensely wealthy businessman, along with his brother Rashid Popal, who in a separate case pleaded guilty to a heroin charge in 1996 in Brooklyn. The Popal brothers control the huge Watan Group in Afghanistan, a consortium engaged in telecommunications, logistics and, most important, security. Watan Risk Management, the Popals' private military arm, is one of the few dozen private security companies in Afghanistan. One of Watan's enterprises, key to the war effort, is protecting convoys of Afghan trucks heading from Kabul to Kandahar, carrying American supplies.

Welcome to the wartime contracting bazaar in Afghanistan. It is a virtual carnival of improbable characters and shady connections, with former CIA officials and ex-military officers joining hands with former Taliban and mujahedeen to collect US government funds in the name of the war effort.

In this grotesque carnival, the US military's contractors are forced to pay suspected insurgents to protect American supply routes. It is an accepted fact of the military logistics operation in Afghanistan that the US government funds the very forces American troops are fighting. And it is a deadly irony, because these funds add up to a huge amount of money for the Taliban. "It's a big part of their income," one of the top Afghan government security officials told The Nation in an interview. In fact, US military officials in Kabul estimate that a minimum of 10 percent of the Pentagon's logistics contracts--hundreds of millions of dollars--consists of payments to insurgents.

Understanding how this situation came to pass requires untangling two threads. The first is the insider dealing that determines who wins and who loses in Afghan business, and the second is the troubling mechanism by which "private security" ensures that the US supply convoys traveling these ancient trade routes aren't ambushed by insurgents.

A good place to pick up the first thread is with a small firm awarded a US military logistics contract worth hundreds of millions of dollars: NCL Holdings. Like the Popals' Watan Risk, NCL is a licensed security company in Afghanistan.

What NCL Holdings is most notorious for in Kabul contracting circles, though, is the identity of its chief principal, Hamed Wardak. He is the young American son of Afghanistan's current defense minister, Gen. Abdul Rahim Wardak, who was a leader of the mujahedeen against the Soviets. Hamed Wardak has plunged into business as well as policy. He was raised and schooled in the United States, graduating as valedictorian from Georgetown University in 1997. He earned a Rhodes scholarship and interned at the neoconservative think tank the American Enterprise Institute. That internship was to play an important role in his life, for it was at AEI that he forged alliances with some of the premier figures in American conservative foreign policy circles, such as the late Ambassador Jeane Kirkpatrick.

Wardak incorporated NCL in the United States early in 2007, although the firm may have operated in Afghanistan before then. It made sense to set up shop in Washington, because of Wardak's connections there. On NCL's advisory board, for example, is Milton Bearden, a well-known former CIA officer. Bearden is an important voice on Afghanistan issues; in October he was a witness before the Senate Foreign Relations Committee, where Senator John Kerry, the chair, introduced him as "a legendary former CIA case officer and a clearheaded thinker and writer." It is not every defense contracting company that has such an influential adviser.

But the biggest deal that NCL got--the contract that brought it into Afghanistan's major leagues--was Host Nation Trucking. Earlier this year the firm, with no apparent trucking experience, was named one of the six companies that would handle the bulk of US trucking in Afghanistan, bringing supplies to the web of bases and remote outposts scattered across the country.

At first the contract was large but not gargantuan. And then that suddenly changed, like an immense garden coming into bloom. Over the summer, citing the coming "surge" and a new doctrine, "Money as a Weapons System," the US military expanded the contract 600 percent for NCL and the five other companies. The contract documentation warns of dire consequences if more is not spent: "service members will not get food, water, equipment, and ammunition they require." Each of the military's six trucking contracts was bumped up to $360 million, or a total of nearly $2.2 billion. Put it in this perspective: this single two-year effort to hire Afghan trucks and truckers was worth 10 percent of the annual Afghan gross domestic product. NCL, the firm run by the defense minister's well-connected son, had struck pure contracting gold.

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Aram Roston is an Emmy Award-winning investigative producer at NBC News and the author of The Man Who Pushed America to War: The Extraordinary Life, Adventures, and Obsessions of Ahmad Chalabi (Nation Books), from which this article is adapted.

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