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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsBooz Allen, the World's Most Profitable Spy Organization
(Bloomberg Businesseek) In 1940, a year before the attack on Pearl Harbor, the U.S. Navy began to think about what a war with Germany would look like. The admirals worried in particular about the Kriegsmarines fleet of U-boats, which were preying on Allied shipping and proving impossible to find, much less sink. Stymied, Secretary of the Navy Frank Knox turned to Booz, Fry, Allen & Hamilton, a consulting firm in Chicago whose best-known clients were Goodyear Tire & Rubber (GT) and Montgomery Ward. The firm had effectively invented management consulting, deploying whiz kids from top schools as analysts and acumen-for-hire to corporate clients. Working with the Navys own planners, Booz consultants developed a special sensor system that could track the U-boats brief-burst radio communications and helped design an attack strategy around it. With its aid, the Allies by wars end had sunk or crippled most of the German submarine fleet.
That project was the start of a long collaboration. As the Cold War set in, intensified, thawed, and was supplanted by global terrorism in the minds of national security strategists, the firm, now called Booz Allen Hamilton (BAH), focused more and more on government work. In 2008 it split off its less lucrative commercial consulting armunder the name Booz & Co.and became a pure government contractor, publicly traded and majority-owned by private equity firm Carlyle Group (CG). In the fiscal year ended in March 2013, Booz Allen Hamilton reported $5.76 billion in revenue, 99 percent of which came from government contracts, and $219 million in net income. Almost a quarter of its revenue$1.3 billionwas from major U.S. intelligence agencies. Along with competitors such as Science Applications International Corp. (SAIC), CACI, and BAE Systems (BA/), the McLean (Va.)-based firm is a prime beneficiary of an explosion in government spending on intelligence contractors over the past decade. About 70 percent of the 2013 U.S. intelligence budget is contracted out, according to a Bloomberg Industries analysis; the Office of the Director of National Intelligence (ODNI) says almost a fifth of intelligence personnel work in the private sector.
Its safe to say that most Americans, if theyd heard of Booz Allen at all, had no idea how huge a role it plays in the U.S. intelligence infrastructure. They do now. On June 9, a 29-year-old Booz Allen computer technician, Edward Snowden, revealed himself to be the source of news stories showing the extent of phone and Internet eavesdropping by the National Security Agency. Snowden leaked classified documents he loaded onto a thumb drive while working for Booz Allen at an NSA listening post in Hawaii, and hes promised to leak many more. After fleeing to Hong Kong, hes been in hiding. (He didnt respond to a request for comment relayed by an intermediary.)
The attention has been bad for Booz Allens stock, which fell more than 4 percent the morning after Snowden went public and still hasnt recovered. Senator Dianne Feinstein (D-Calif.), who chairs the Select Committee on Intelligence, has called for a reexamination of the role of private contractors in intelligence work and announced shell seek to restrict their access to classified information. Booz Allen declined to comment on Snowden beyond its initial public statement announcing his termination. ..................(more)
The complete piece is at: http://www.businessweek.com/articles/2013-06-20/booz-allen-the-worlds-most-profitable-spy-organization#r=read
xchrom
(108,903 posts)atreides1
(16,093 posts)In May employees of Booz Allen working for a government agency(not the NSA) had their contracts "descoped" and were laid off...many were told by phone that their services were no longer needed...some got rehired, but at less then what they had been earning...while others are still unemployed!
The unofficial explanation for the "descoping" of certain contracts was so that this agency could avoid furloughs brought about by the sequestration...unfortunately the plan backfired, because the furloughs had already been put into place.
Of that 5.76 billion...none of it has been used to even find open government positions for these employees...and there are reports of more "descoping" taking place in the near future.
As for Senator Feinstein, maybe she should reexamine the role of all private contractors, to include her husband's construction company of which I'm sure she enjoys the revenue it brings in to their bank account!
Catherina
(35,568 posts)byeya
(2,842 posts)for it and plans to soak the US government for its private spying operation. (My understanding anyway)
HooptieWagon
(17,064 posts)He's doing it in partnership with the Bush family!