T. Christian Miller -- Insurance System for Injured War Contractors Is Broken

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By T. Christian Miller
Sunday, August 16, 2009

To outsource the wars in Iraq and Afghanistan, the United States has turned to the cheapest labor possible. About two-thirds of the 200,000 civilians working under federal contracts in the war zones are foreigners. Many come from poor, Third World countries. Others are local hires.

These low-paid foreign workers face many of the same risks soldiers do. Mortars have killed Filipinos who served meals in mess halls. Assassins have targeted Iraqis translating for soldiers. Roadside bombs have ripped into trucks driven by Turkish nationals. These workers have been wounded like soldiers. They have died like soldiers.

The United States has a system to provide care for such civilian casualties. Developed in the 1940s, it is an obscure type of workers' compensation insurance, funded by taxpayers and overseen by the Labor Department. Mandated by a law called the Defense Base Act, the system requires almost every federal contractor working abroad to purchase insurance to cover injuries arising from work or war, for all employees, American or foreign.

American civilian workers have had trouble enough getting payment for their injuries. AIG, the primary provider of such insurance, has battled them over everything from prosthetic legs to treatment for post-traumatic stress disorder, according to court records and interviews. But at least the Americans have a fighting chance.

For foreign workers, the system has not even come close to delivering on its promises. In Nepal, I spoke with a family in a remote valley of tumbling rivers and jewel-green rice fields. After neighbors heard news reports over the radio, the family watched an Internet video that showed that their son had been executed in a dusty ditch in western Iraq on his way to work at a base for U.S. soldiers. Neither the company nor the United States had made any effort to contact them. The elderly couple, who had relied upon their son's salary, wondered how they would survive.

In the Philippines, I spoke to a woman who received a cellphone message when her son's father died: "God took him." She, too, had never been told of her rights to benefits by the employer or the United States. Her partner's wages were so low that the death payment would have amounted to about $14,000. Not much, perhaps. But on the day I met her in a slum of tin shanties and reeking sewage, she did not know where she would find food that night for her three 3-year-old son. She still has received no payments.

These are not isolated examples. They are part of a pattern of neglect by the U.S. government and its contractors to inform civilian workers of their rights or even to deliver care that has already been purchased by taxpayers. While about two-thirds of the contractors in Iraq and Afghanistan are foreigners, only about 15 percent of claims are filed by foreigners, according to an analysis of Labor Department and Pentagon records by ProPublica, a nonprofit newsroom.

Since foreigners work many of the same jobs as Americans, albeit for far less money, the reasons for the disparity seem obvious. Their care has been entrusted to an overwhelmed bureaucracy and the machinations of insurance firms and multinational corporations. And the government has so far shown little interest in helping them out.

Seth Harris, the deputy secretary of labor, said at a congressional hearing in June that the program has "systemic problems," and he urged Congress to enact new legislation. "The program is not designed for the circumstances we're in right now," Harris told the House Committee on Oversight and Government Reform. "We are trying to meet a complex, 21st-century challenge with a program from World War II."

Harris's history lesson is spot on. Congress, corporate America and individual laborers banded together 60 years ago to create the program for wounded war workers after what is perhaps one of the most forgotten chapters of World War II.

On the day of the Pearl Harbor bombing, Japanese forces also attacked the South Pacific outpost of Wake Island. At the time, about 1,200 American construction workers were beefing up the island's defenses. Most were employed by an Idaho construction company, Morrison Knudsen. Aided by the contractors, who manned gun batteries in some cases, U.S. Marines repelled the first attack, but they fell to a second assault on Dec. 23, 1941.

The Japanese sent both civilians and soldiers to prisoner-of-war camps in China. But a contingent of 98 contract workers was kept on the island as forced labor. They were all men, mostly white, from towns across America. Photos show them with pomaded hair and fedoras. When the U.S. Navy attacked the island in October 1943, the Japanese lined up the workers and executed them, dumping their bodies in a mass grave.


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