State Dept. May Phase Out Blackwater

WASHINGTON -- The State Department may phase out or limit the use of private security guards in Iraq, which could mean canceling Blackwater USA's contract or awarding it to another company in line with an Iraqi government demand, The Associated Press has learned.

Such steps would be difficult given U.S. reliance on Blackwater and other contractors, but they are among options being studied during a comprehensive review of security in Iraq, two senior officials said.

The review was ordered after a Sept. 16 incident in which Blackwater guards protecting a U.S. Embassy convoy in Baghdad are accused of killing 17 Iraqi civilians.

The shooting has enraged the Iraqi government, which is demanding millions in compensation for the victims and removal of Blackwater in six months. It also has focused attention on the nebulous rules governing private guards and added to the Bush administration's problems in managing the war in Iraq.

And it prompted Secretary of State Condoleezza Rice to order the top-to-bottom review from a commission headed by Patrick Kennedy, one of the State Department's most experienced management officials.

Kennedy has been told to concentrate on several key issues, according to the officials, who spoke on condition of anonymity because the review is still under way. Among them:

_Changes to the rules of engagement under which State Department security contractors operate, particularly for approaching suspicious vehicles, which is at the crux of the Sept. 16 incident. Blackwater insists its guards were fired upon, although Iraqi witnesses and the Iraqi government maintain the guards opened fire with no provocation when a vehicle got too close.

_Whether Blackwater's secretive corporate culture, reputed to have encouraged a "cowboy-like mentality," has led to its employees being more likely to violate or stretch the existing rules than those of the two other private security firms, Dyncorp and Triple Canopy, the State Department uses in Iraq.

_Whether it's feasible to eliminate or drastically curtail the use of private foreign contractors to protect U.S. diplomats in Iraq. And, if so, how to replace them.....