Corporate Corruption News Stories

Excerpts of Key Corporate Corruption News Stories in Major Media

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Over the past four years, the amount of money the State Department pays to private security and law enforcement contractors has soared to nearly $4 billion a year from $1 billion, ... but ... the department had added few new officials to oversee the contracts. Auditors and outside exerts say the results have been vast cost overruns, poor contract performance and, in some cases, violence that has so far gone unpunished. A vast majority of the money goes to companies like DynCorp International and Blackwater [Worldwide] to protect diplomats overseas, train foreign police forces and assist in drug eradication programs. There are only 17 contract compliance officers at the State Departments management bureau overseeing spending of the billions of dollars on these programs, officials said. Two new reports have delivered harsh judgments about the State Departments handling of the contracts, including the protective services contract that employs Blackwater guards whose involvement in a Sept. 16 shooting in Baghdad has raised questions about their role in guarding American diplomats in Iraq. The ballooning budget for outside contracts at the State Department is emblematic of a broader trend, contracting experts say. The Bush administration has doubled the amount of government money going to all types of contractors to $400 billion, creating a new and thriving class of post-9/11 corporations carrying out delicate work for the government. But the number of government employees issuing, managing and auditing contracts has barely grown. Thats a criticism thats true of not just State but of almost every agency, said Jody Freeman, an expert on administrative law at Harvard Law School.

Two new questions arise, courtesy of the latest advancement in cellphone technology: Do you want your friends, family, or colleagues to know where you are at any given time? And do you want to know where they are? Obvious benefits come to mind. Parents can take advantage of the Global Positioning System chips embedded in many cellphones to track the whereabouts of their phone-toting children. And for teenagers and 20-somethings, who are fond of sharing their comings and goings on the Internet, youth-oriented services like Loopt and Buddy Beacon are a natural next step. But ... if G.P.S. [makes] it harder to get lost, new cellphone services are now making it harder to hide. “There are massive changes going on in society, particularly among young people who feel comfortable sharing information in a digital society,” said Kevin Bankston, a staff lawyer at the Electronic Frontier Foundation. “We seem to be getting into a period where people are closely watching each other,” he said. “There are privacy risks we haven’t begun to grapple with.” What if a boss asks an employee to use the service? Almost 55 percent of all mobile phones sold today in the United States have the technology that makes such friend- and family-tracking services possible. Consumers can turn off their service, making them invisible to people in their social-mapping network. Still, the G.P.S. service embedded in the phone means that your whereabouts are not a complete mystery. “There is a Big Brother component,” said Charles S. Golvin, a wireless analyst. “The thinking goes that if my friends can find me, the telephone company knows my location all the time, too.”

Note: For revealing major media reports of privacy risks and invasions, click here.

When previous Republican administrations were accused of illegality in the FBI and CIA spying abuses of the 1970s or the Iran-Contra affair of the 1980s, Democrats in Congress launched investigations or pushed for legislative reforms. But last week, faced with admissions by several telecommunication companies that they assisted the Bush administration in warrantless spying on Americans, leaders of the Senate intelligence committee took a much different tack -- proposing legislation that would grant those companies retroactive immunity from prosecution or lawsuits. The proposal marks the second time in recent years that Congress has moved toward providing legal immunity for past actions that may have been illegal. The Military Commissions Act, passed by a GOP-led Congress in September 2006, provided retroactive immunity for CIA interrogators who could have been accused of war crimes for mistreating detainees. Legal experts say the granting of such retroactive immunity by Congress is unusual, particularly in a case involving private companies. "It's particularly unusual in the case of the telecoms because you don't really know what you're immunizing," said Louis Fisher, a specialist in constitutional law with the Law Library of the Library of Congress. Civil liberties groups and many academics argue that Congress is allowing the government to cover up possible wrongdoing and is inappropriately interfering in disputes that the courts should decide. The American Civil Liberties Union [said] in a news release Friday that "the administration is trying to cover its tracks."

[Las Vegas], famous for being America's playground, has also become its security lab. Like nowhere else in the United States, Las Vegas has embraced the twin trends of data mining and high-tech surveillance, with arguably more cameras per square foot than any airport or sports arena in the country. Even the city's cabs and monorail have cameras. Some privacy advocates view the city as a harbinger of things to come. In secret rooms in casinos across Las Vegas, surveillance specialists are busy analyzing information about players and employees. Relying on thousands of cameras in nearly every cranny of the casinos, they evaluate ... behavior. They ping names against databases that share information with other casinos, sometimes using facial-recognition software to validate a match. And in the marketing suites, casino staffers track players' every wager, every win or loss, the better to target high-rollers for special treatment and low- and middle-rollers for promotions. "You could almost look at Vegas as the incubator of a whole host of surveillance technologies," said James X. Dempsey, policy director for the Center for Democracy and Technology. Those technologies, he said, have spread to other commercial venues: malls, stadiums, amusement parks. After Sept. 11, 2001, several airports tested facial-recognition software, with little success. But the government is continuing to invest in biometric technologies. "We often hear of the surveillance technology du jour, but what we're seeing now in America is a collection of surveillance technologies that work together," said Barry Steinhardt, the American Civil Liberties Union's technology and liberty project director. "It isn't just video surveillance or face recognition or license plate readers or RFID chips. It's that all these technologies are converging to create a surveillance society."

Note: For revealing major media reports of privacy risks and invasions, click here.

The medicines long used by parents to treat their children's coughs and colds don't work and shouldn't be used in those younger than 6, federal health advisers recommended. "The data that we have now is they don't seem to work," said Sean Hennessy, a University of Pennsylvania epidemiologist. The recommendation applies to medicines containing one or more of the following ingredients: decongestants, antihistamines and antitussives. In two separate votes ... the panelists said the medicines shouldn't be used in children younger than 2 or in those younger than 6. A third vote, to recommend against use in children 6 to 11, failed. The panel's advice dovetails with a petition filed by pediatricians that argued the over-the-counter medicines shouldn't be given to children younger than 6, an age group they called the most vulnerable to potential ill effects. The American Academy of Pediatrics and other groups back the petition. But FDA officials and panelists agreed there's no evidence they work in older children, either. Still, panelists held off from recommending against use in those 6 and older. And some said they feared such a prohibition wouldn't eliminate use of the medicines by parents. "They will administer adult products to their children because they work for them or feel they work for them," said the panel's patient and family representative, Amy Celento of Nutley, N.J. Some of the drugs — which include Wyeth's Dimetapp and Robitussin, Johnson & Johnson's Pediacare and Novartis AG's Triaminic products — have never been tested in children, something flagged as long ago as 1972 by a previous FDA panel. An FDA review found just 11 studies of children published over the last half-century. Those studies did not establish that the medicines worked in those cases, according to the agency.

Note: For a powerful exposé of corporate and government corruption in the health industry, click here.

The US arms industry is backing Hillary Clinton for President and has all but abandoned its traditional allies in the Republican party. Mrs Clinton has also emerged as Wall Street's favourite. Investment bankers have opened their wallets in unprecedented numbers for the New York senator over the past three months and, in the process, dumped their earlier favourite, Barack Obama. An analysis of campaign contributions shows senior defence industry employees are pouring money into her war chest in the belief that their generosity will be repaid many times over with future defence contracts. Employees of the top five US arms manufacturers – Lockheed Martin, Boeing, Northrop-Grumman, General Dynamics and Raytheon – gave Democratic presidential candidates $103,900, with only $86,800 going to the Republicans. "The contributions clearly suggest the arms industry has reached the conclusion that Democratic prospects for 2008 are very good indeed," said Thomas Edsall, an academic at Columbia University in New York. Republican administrations are by tradition much stronger supporters of US armaments programmes and Pentagon spending plans than Democratic governments. Relations between the arms industry and Bill Clinton soured when he slimmed down the military after the end of the Cold War. His wife, however, has been careful not to make the same mistake. After her election to the Senate, she became the first New York senator on the armed services committee, where she revealed her hawkish tendencies by supporting the invasion of Iraq. Her position on Iran is among the most warlike of all the candidates – Democrat or Republican. While on the armed services committee, Mrs Clinton has befriended key generals and has won the endorsement of General Wesley Clarke, who ran Nato's war in Kosovo. The arms industry has duly taken note.

Note: For a revealing personal account of the "War Racket" by a U.S. general, click here.

More than half of department chairs at U.S. medical schools and teaching hospitals have financial ties with the drug industry, a new study finds. "There is not a single aspect of medicine in which the drug companies do not have substantial and deep relationships, [including] doctors-in-training, resident physicians, researchers, physicians-in-practice, the people who review drugs for the federal government and the people who review studies," said lead researcher Eric Campbell, associate professor at the Institute for Health Policy at Massachusetts General Hospital and Harvard Medical School in Boston. "Drug companies have relationships with everyone," he continued. "They're involved in every aspect of medicine. Someone has to decide which of these is OK." The study, the first to examine the extent of these institutional relationships, is published in the Oct. 17 issue of the Journal of the American Medical Association. "I think the paper is a very valuable contribution, in that it provides what's probably the first comprehensive documentation of the extent of relationships that involve department chairs, and department chairs are certainly the key agents of overseeing and maintaining the day-to-day operations of a medical school or teaching hospital," said Dr. David Korn ... at the Association of American Medical Colleges in Washington, D.C. The issue of medicine's ties to industry has been a hot one of late. One study found that third-year medical students get, on average, one gift or attend one activity sponsored by a drug maker each week. "Now it's up to the policymakers and people who run medical schools," said Campbell. "They need to come up with some rules and they need to be new rules. I believe there's very little reasonable justification for why drug companies should be involved in the education of medical students."

Note: For a powerful overview of medical corruption, click here.

Using a mobile phone for more than 10 years increases the risk of getting brain cancer, according to the most comprehensive study of the risks yet published. The study – which contradicts official pronouncements that there is no danger of getting the disease – found that people who have had the phones for a decade or more are twice as likely to get a malignant tumour on the side of the brain where they hold the handset. The scientists who conducted the research say using a mobile for just an hour every working day during that period is enough to increase the risk – and that the international standard used to protect users from the radiation emitted is "not safe" and "needs to be revised". They conclude that "caution is needed in the use of mobile phones" and believe children, who are especially vulnerable, should be discouraged from using them at all. Official assurances that the phones are safe have been based on research that has, at best, included only a few people who have been exposed to the radiation for long enough to get the disease, and are therefore of little or no value in assessing the real risk. The scientists pulled together the results of the 11 studies that have so far investigated the occurrence of tumours in people who have used phones for more than a decade, drawing on research in Sweden, Denmark Finland, Japan, Germany, the United States and Britain. They found almost all had discovered an increased risk, especially on the side of the head where people listened to their handsets. [One of the study's authors] said he uses a mobile phone as little as possible, and urges others to use hands-free equipment and make only short calls, reserving longer ones for landlines. He also said that mobiles should not be given to children, whose thinner skulls and developing nervous systems make them particularly vulnerable.

Note: Evidence has been mounting for some years that cell phones and wireless technology (WiFi) have significant health risks. For a recent brief summary by a highly respected scientist, click here.

Despite the protests of more than 50 scientists, including five Nobel laureates in chemistry, the U.S. Environmental Protection Agency on Friday approved use of a new, highly toxic fumigant, mainly for strawberry fields. The new pesticide, methyl iodide, is designed for growers, mainly in California and Florida, who need to replace methyl bromide, which has been banned under an international treaty because it damages the Earth's ozone layer. In a letter sent last month to EPA Administrator Stephen Johnson, 54 scientists, mostly chemists, warned that "pregnant women and the fetus, children, the elderly, farmworkers and other people living near application sites would be at serious risk." Methyl iodide is a neurotoxin and carcinogen that has caused thyroid tumors, neurological damage and miscarriages in lab animals. But EPA officials said Friday that they carefully evaluated the risks and decided to approve its use for one year, imposing restrictions such as buffer zones to protect farmworkers and neighbors. Growers, particularly those who grow strawberries and tomatoes, have been searching for 15 years for a new soil fumigant to replace methyl bromide. Fumigants are valuable to growers because they can be injected into the soil before planting to sterilize the field and kill a broad spectrum of insects and diseases without leaving residue on crops. But fumigants are among the most potentially dangerous pesticides in use today because the toxic gas can evaporate from the soil, exposing farmworkers and drifting into neighborhoods. Methyl iodide ... will be allowed on fields growing strawberries, tomatoes, peppers, ornamentals, turf, trees and vines.

More than 14 months after the Agriculture Department began an investigation into how the U.S. supply of long-grain rice became tainted with an unapproved genetically engineered variety -- an event that continues to disrupt U.S. exports -- the government announced yesterday that it could not figure out how the contamination happened. Agency officials said documents from several years ago that might have helped them determine what went wrong had been lost or destroyed. Lacking clear evidence of who was responsible, they said, the government will not take enforcement action against any person or entity, including Bayer CropScience, the company whose gene-altered products slipped into the food supply. The widespread, low-level contamination with experimental genes that make the rice pesticide-tolerant, one of several such events in recent years, prompted countries around the world to cut off imports of U.S. long-grain rice. Rice prices plummeted, and many farmers, scientists and biotechnology activists called for an overhaul of the oversight system for gene-altered crops. While some countries have begun to accept U.S. rice with added testing, the European Union and Russia have not -- a trade loss valued in the hundreds of millions of dollars a year. Critics assailed the report as yet more evidence that the nation's regulatory system for gene-altered crops is broken. "This underlines the anxiety people have about more such incidents occurring," said Margaret Mellon of the Union of Concerned Scientists, a science-based advocacy group that has called for a more rigorous approval process for biotech crops.

Note: For important reports from major media sources which reveal the dangers of genetically modified foods and other organisms, click here.

The Shock Doctrine is [Naomi] Klein’s ambitious look at the economic history of the last 50 years and the rise of free-market fundamentalism around the world. “Disaster capitalism,” as she calls it, is a violent system that ... requires terror to do its job. Extreme capitalism loves a blank slate, often finding its opening after crises or “shocks.” Klein compares radical capitalist economic policy to shock therapy administered by psychiatrists. She interviews Gail Kastner, a victim of covert C.I.A. experiments in interrogation techniques that were carried out by the scientist Ewen Cameron in the 1950s. His idea was to use electroshock therapy to break down patients. Once “complete depatterning” had been achieved, the patients could be reprogrammed. For Klein the larger lessons are clear: “Countries are shocked — by wars, terror attacks, coups d’état and natural disasters.” Then “they are shocked again — by corporations and politicians who exploit the fear and disorientation of this first shock to push through economic shock therapy.” People who “dare to resist” are shocked for a third time, “by police, soldiers and prison interrogators.” Klein offers an account of Milton Friedman — she calls him “the other doctor shock”. In the 1950s, as Cameron was conducting his experiments, the Chicago School was developing the ideas that [dominate capitalist planning today]. She quotes the Chilean economist Orlando Letelier on the “inner harmony” between the terror of the Pinochet regime and its free-market policies. Letelier said that Milton Friedman shared responsibility for the regime’s crimes, rejecting his argument that he was only offering “technical” advice. Letelier was killed in 1976 by a car bomb planted in Washington [DC]. For Klein, he was another victim of the “Chicago Boys” who wanted to impose free-market capitalism on the region. “In the Southern Cone, where contemporary capitalism was born, the ‘war on terror’ was a war against all obstacles to the new order,” she writes.

Note: For highly revealing, verifiable information on government mind control programs, click here.

Employees of Blackwater USA have engaged in nearly 200 shootings in Iraq since 2005, in [the] vast majority of cases firing their weapons from moving vehicles without stopping to count the dead or assist the wounded, according to a new report from Congress. In at least two cases, Blackwater paid victims’ family members who complained, and sought to cover up other episodes, the Congressional report said. It said State Department officials approved the payments in the hope of keeping the shootings quiet. In one case last year, the department helped Blackwater spirit an employee out of Iraq less than 36 hours after the employee, while drunk, killed a bodyguard for one of Iraq’s two vice presidents on Christmas Eve. The report ... adds weight to complaints from Iraqi officials, American military officers and Blackwater’s competitors that company guards have taken an aggressive, trigger-happy approach to their work and have repeatedly acted with reckless disregard for Iraqi life. But the report is also harshly critical of the State Department for exercising virtually no restraint or supervision of the private security company’s 861 employees in Iraq. “There is no evidence in the documents that the committee has reviewed that the State Department sought to restrain Blackwater’s actions, raised concerns about the number of shooting episodes involving Blackwater or the company’s high rate of shooting first, or detained Blackwater contractors for investigation,” the report states. Based on 437 internal Blackwater incident reports as well as internal State Department correspondence, the report said Blackwater’s use of force was “frequent and extensive, resulting in significant casualties and property damage.” The State Department ... has paid Blackwater more than $832 million for security services in Iraq and elsewhere, under a diplomatic security contract it shares with two other companies, DynCorp International and Triple Canopy.

Despite being implicated in several controversial killings, [Blackwater] is the Pentagon's most favoured contractor and has effective diplomatic immunity in Iraq. Referred to as "the most powerful mercenary army in the world", both the US ambassador to Iraq and the army's top generals hold it in regard. The company, based near the Great Dismal Swamp in North Carolina, was co-founded by Erik Prince, a billionaire right-wing fundamentalist. At its HQ, Blackwater has trained more than 20,000 mercenaries to operate as freelancers in wars around the world. Prince is a big bankroller of the Republican Party - giving a total of around $275,550 - and was a young intern in the White House of George Bush Sr. Under George Bush Jr, Blackwater received lucrative no-bid contracts for work in Iraq, Afghanistan and New Orleans after hurricane Katrina. His firm has pulled down contracts worth at least $320 million in Iraq alone. Jeremy Scahill, who wrote the book Blackwater: The Rise Of The World's Most Powerful Mercenary Army, says when Bush was re-elected in 2004, one company boss sent this email to staff: "Bush Wins, Four More Years!! Hooyah!!" One Blackwater employment policy is to hire ex-administration big-hitters into key positions. It hired Cofer Black, a former State Department co-ordinator for counter-terrorism and former head of the CIA's counter-terrorism centre, as vice-chairman. Robert Richer, a former CIA divisional head, joined Blackwater as vice-president of intelligence in 2005. Scahill says the firm is "the front line in what the Bush administration views as the necessary revolution in military affairs" - privatisation of as many roles as possible. Scahill went on to call Prince a "neo-crusader, a Christian supremacist, who ... has been allowed to create a private army to defend Christendom around the world."

The Food and Drug Administration does very little to ensure the safety of the millions of people who participate in clinical trials, a federal investigator has found. The inspector general of the Department of Health and Human Services, Daniel R. Levinson, said federal health officials did not know how many clinical trials were being conducted, audited fewer than 1 percent of the testing sites and, on the rare occasions when inspectors did appear, generally showed up long after the tests had been completed. The F.D.A. has 200 inspectors, some of whom audit clinical trials part time, to police an estimated 350,000 testing sites. Even when those inspectors found serious problems in human trials, top drug officials in Washington downgraded their findings 68 percent of the time, the report found. Among the remaining cases, the agency almost never followed up with inspections to determine whether the corrective actions that the agency demanded had occurred. “In many ways, rats and mice get greater protection as research subjects in the United States than do humans,” said Arthur L. Caplan, chairman of the department of medical ethics at the University of Pennsylvania. Animal research centers have to register with the federal government, keep track of subject numbers, have unannounced spot inspections and address problems speedily or risk closing, none of which is true in human research, Mr. Caplan said. Because no one collects the data systematically, there is no way to tell how safe the nation’s clinical research is or ever has been. The drug agency oversees just the safety of trials by companies seeking approval to sell drugs or devices. Using an entirely different set of rules, the Office for Human Research Protections oversees trials financed by the federal government. Privately financed noncommercial trials have no federal oversight.

Note: For further information on corruption in the health care industry, click here.

A consumer advocacy group [has] released a study alleging credit card companies use arbitration firms that they know will rarely rule in favor of consumers. Nearly all credit card customer service agreements mandate binding arbitration because it is a cheaper and faster way to resolve disputes, industry officials say. Public Citizen though says the companies hire arbitration firms that almost always rule in favor of the card issuer. Arbitration firms used by companies such as Mastercard Inc., Visa, Discover Financial Services LLC and American Express Co. ruled against consumers in 32,300 of 34,000 disputes that went to arbitration, according to Public Citizen's study. 'This is a system that is unfair to consumers,' Joan Claybrook, the group's president said at a press briefing. Sen. Russ Feingold, D-Wis. and Rep Hank Johnson, D-Ga., attended the briefing to say they have introduced legislation that would let credit card customers choose arbitration or civil court in a dispute. 'People shouldn't have to give up their legal rights just to get a credit card,' Claybrook said. Public Citizen's study singled out arbitration disputes in California because it is the only state that requires arbitration resolutions be disclosed. Public Citizen also singled out the Minneapolis-based National Arbitration Forum, which has arbitrated many of the disputes analyzed.

For years, the [Bush] administration has been quietly auctioning off U.S. foreign policy to the highest corporate bidder -- and it may be too late for us to buy it back. Look at Blackwater. Blackwater increasingly promises to do everything the U.S. government can do, but better. Blackwater's facility in North Carolina is the world's largest private military facility -- it's so good that the U.S. military uses it for training. Since its founding, it has trained 50,000 "consultants" who can be deployed anywhere in the world. With no geographical limits, the company is eager to prove its value. Blackwater has trained police in Afghanistan and naval commandos in Azerbaijan, and it sent heavily armed employees to New Orleans after Hurricane Katrina. They started off offering their services as volunteers -- or vigilantes, some critics said. FEMA, playing catch-up, followed with contracts, as did a number of other agencies. Increasingly, Blackwater looks like a miniature government. It has people, infrastructure and hardware. For instance, it is buying Brazilian-made fighter bombers -- great in combat but not really necessary if you're merely providing civilian bodyguards. Blackwater is unusual, but it's not entirely unique. Other corporations ... are also eagerly filling the vacuum as the U.S. government retreats worldwide from the business of governing. The White House's motives are obvious. Why fight another war, with all the bother of convincing Congress, if you can quietly hire a private military company to fight it for you? Why interrogate suspected insurgents if you can outsource the whole messy business? As for the corporations so eagerly lapping up the contracting dollars, there's no conspiracy -- it's just the good old profit motive.

The nation’s biggest telecommunications companies, working closely with the White House, have mounted a secretive lobbying campaign to get Congress to quickly approve a measure wiping out all private lawsuits against them for assisting the U.S. intelligence community’s warrantless surveillance programs. The campaign — which involves some of Washington's most prominent lobbying and law firms — has taken on new urgency in recent weeks because of fears that a U.S. appellate court in San Francisco is poised to rule that the lawsuits should be allowed to proceed. If that happens, the telecom companies say, they may be forced to terminate their cooperation with the U.S. intelligence community — or risk potentially crippling damage awards for allegedly turning over personal information about their customers to the government without a judicial warrant. But critics say the language proposed by the White House — drafted in close cooperation with the industry officials — is so extraordinarily broad that it would provide retroactive immunity for all past telecom actions related to the surveillance program. Its practical effect, they argue, would be to shut down any independent judicial or state inquires into how the companies have assisted the government in eavesdropping on the telephone calls and e-mails of U.S. residents in the aftermath of the September 11 terror attacks. “It’s clear the goal is to kill our case," said Cindy Cohn, legal director of the Electronic Frontier Foundation, [which] filed the main lawsuit against the telecoms after The New York Times first disclosed, in December 2005, that President Bush had approved a secret program to monitor the phone conversations of U.S. residents without first seeking judicial warrants. “I find it a little shocking that Congress would participate in the covering up of what has been going on," added Cohn.

A globalized world that could bring down the Berlin Wall, and deliver fresh fruit in the middle of the coldest winter months, wasn't supposed to foster one of the darkest of human practices — slavery. This version of the world was supposed to make life for everyone, everywhere, better. Better medicine, better prices, better democracies. Not so, says John Bowe in his incredible book, Nobodies: Modern American Slave Labor and the Dark Side of the New Global Economy. Not only is slavery a reality, but how we've executed this rush toward globalization may have created the very conditions necessary for slavery to gain a toehold in the modern world. Nobodies is investigative, immersion reporting at its best. The line between observer and participant blurs, and the reality of time, place and subject come crashing out in full detail. Bowe is a master storyteller whose work is finely tuned and fearless. When the time is appropriate, he goes so far as to question his own assumptions, ideals and practices without holding back. "Go out into this newly globalized world you're profiting from," he writes, "go visit the people being 'lifted' out of poverty, the workers who are making your products. Go live in their huts, eat their rice and plantains, squat on their floors, and listen to their babies cry. Sniff some glue and pray with them. Try to get justice from their police if someone hurts you. And then come back and let's talk about freedom." There's a chill in the air when he writes: "If you can read this page, you are on top of the world and billions of people are beneath you. Your ignorance and your lack of a program will likely equal the squalor of your grandchildren's existence."

Li Runsen, the powerful technology director of China’s ministry of public security, is best known for leading Project Golden Shield, China’s intensive effort to strengthen police control over the Internet. But last month Mr. Li took an additional title: director for China Security and Surveillance Technology, a fast-growing company that installs and sometimes operates surveillance systems for Chinese police agencies, jails and banks, among other customers. The company has just been approved for a listing on the New York Stock Exchange. The company’s listing and Mr. Li’s membership on its board are just the latest signs of ever-closer ties among Wall Street, surveillance companies and the Chinese government’s security apparatus. Wall Street analysts now follow the growth of companies that install surveillance systems providing Chinese police stations with 24-hour video feeds from nearby Internet cafes. Hedge fund money from the United States has paid for the development of not just better video cameras, but face-recognition software and even newer behavior-recognition software designed to spot the beginnings of a street protest and notify police. Executives of Chinese surveillance companies say they are helping their government reduce street crime, preserve social stability and prevent terrorism. They note that London has a more sophisticated surveillance system, although the Chinese system will soon be far more extensive. Wall Street executives also defend the industry as necessary to keep the peace at a time of rapid change in China. They point out that New York has begun experimenting with surveillance cameras in Lower Manhattan and other areas of the city.

The Defense Department is paying private contractors more than $1 billion in more than 30 separate contracts to collect and analyze intelligence for the four military services and its own Defense Intelligence Agency, according to contract documents and a Pentagon spokesman. The disclosure marks the first time a U.S. intelligence service has made public its outside payments. Intelligence payments to contractors have climbed dramatically since the terror attacks in September 2001, but none had been made public, according to a report filed in April by the Office of the Director of National Intelligence. Outside contracting ... places critical security tasks and sensitive information in the hands of private parties, says Steven Aftergood, a government secrecy specialist at the Federation of American Scientists, a Washington privacy group. "Private contractors don't have to undergo congressional oversight or justify their budgets to appropriators," Aftergood says. "We're starting to create a new kind of intelligence bureaucracy, one that is both more expensive and less accountable (than government's own intelligence agencies)." Most of the contracts, which extend up to five years, pay for analysis of intelligence data and for related services, such as translation and interpretation of photo and electronic intelligence. A small fraction, which [a Pentagon spokesman] declined to specify, pay for private spies. Private contractors often hire former intelligence officers, sometimes leasing them back at higher salaries to the agencies that first recruited and trained them.

Important Note: Explore our full index to revealing excerpts of key major media news stories on several dozen engaging topics. And don't miss amazing excerpts from 20 of the most revealing news articles ever published.